Japanese shares advanced on Tuesday morning, led by technology firms, as investors looked beyond sluggish earnings in the previous quarter and bet on a potential recovery over the coming seasons.

The Nikkei share average rose 0.67% to 21,761.38, edging near its 2-1/2-month high of 21,823 touched last week, while the broader Topix gained 0.5% to 1,576.34.

Japan’s industrial output also fell a bigger-than-expected 3.6% to 1-1/2-year lows in June but that did not shake investors’ confidence either.

Ahead of that, the Bank of Japan is expected to make its policy announcement later on Tuesday.

While a majority of market players predict no policy change, a small number of them expect the BOJ to make some cosmetic changes to its forward policy guidance in a symbolic gesture of keeping up with easing stances by the Federal Reserve and the European Central Bank.

The Fed is widely expected to cut its interest rates this week for the first time since the financial crisis more than a decade ago.

Source : Reuters