TOKYO, Nov. 7 (Xinhua) -- Japan's benchmark Nikkei stock index closed higher on Monday, tracking gains made on Wall Street, amid hopes the U.S. Federal Reserve may take a more dovish approach ahead towards its monetary tightening policy.
The 225-issue Nikkei Stock Average added 327.90 points, or 1.21 percent, from Friday to close the day at 27,527.64.
The broader Topix index, meanwhile, gained 18.69 points, or 0.98 percent, to finish at 1,934.09.
Local dealers said that sentiment was buoyed early on following Wall Street snapping a four-session losing streak on Friday, with the tech-heavy Nasdaq making gains.
They added that companies reporting solid earnings and outlooks continued to find favor and help prop-up the broader market.
"Investors continued to look for shares with robust earnings," Maki Sawada, a strategist at Nomura Securities was quoted as saying.
"Going forward, investors will be cautious ahead of closely eyed U.S. consumer price data, which is due later this week," Sawada said.
Remarks from Fed officials intimating that the U.S. central bank may look to lower its hefty interest rate hikes from the end of the year and in doing so easing concerns over a U.S. recession, added to an upbeat mood.
All eyes, market strategists also said, had been on data showing that the U.S. unemployment rate increased in October, but the focus now is on data regrading U.S. consumer prices for October due to be released on Thursday.
"Market participants are anticipating that the Fed may start going for 0.50 percentage point hikes from December for a while, rather than a 0.75-point, easing concerns over the U.S. economy," Masahiro Ichikawa, chief market strategist at Sumitomo Mitsui DS Asset Management Co., was quoted as saying.
"Since the Fed has been raising rates aggressively since March, now is the time to assess their effect on the U.S. economy while pursuing smaller hikes," said Ichikawa.
By the close of play, iron and steel, metal product, and marine transportation issues comprised those that gained the most on the Prime Market.
Nikkei heavyweight Tokyo Electron benefited from its U.S. peers gaining ground on the Nasdaq, with the chip-making equipment maker adding 3.8 percent.
Daikin Industries gained 1.8 percent, while fellow heavyweight Fast Retailing, owner of the Uniqlo chain of clothing stores, advanced 1.5 percent.
Issues finding favor on individual earnings reports included JFE Holdings leaping 7.2 percent, after upwardly revising its annual profit outlook.
This gave other steelmakers a boost, with Kobe Steel climbing 3.9 percent, while Nippon Steel ended the day 3 percent higher.
Sanrio, the parent company of the Hello Kitty brand, was a notable winner, soaring 12.9 percent, after it upwardly revised its earnings forecast for the business year ending in March.
Issues that rose outpaced those that fell by 1,298 to 474 on the Prime Market, while 65 ended the day unchanged.
On the Prime Market on Monday, 1,233.59 million shares changed hands, dropping from Friday's volume of 1,639.16 million shares.
The turnover on the first trading day of the week came to 2,912.58 billion yen (19.82 billion U.S. dollars). ■