Stocks Closing UPDATE2

(Japan Economic Newswire Via Acquire Media NewsEdge) TOKYO, Feb. 6 -- (Kyodo) _ (EDS: ADDING INFO, RECASTING) The Nikkei surged to its highest level since September 2008 on Wednesday on the yen's sharp drop against the U.S. dollar triggered by the unexpected announcement that the Bank of Japan governor will step down before the end of his tenure.

The 225-issue Nikkei Stock Average jumped 416.83 points, or 3.77 percent, from Tuesday to 11,463.75, its highest closing level since Sept. 29, 2008, following the collapse of U.S. investment bank Lehman Brothers Holdings Inc.

The broader Topix index of all First Section issues on the Tokyo Stock Exchange was up 29.12 points, or 3.10 percent, at 968.82.

All 33 sectors posted gains led by automakers, sea transport and tire makers.

The Nikkei logged its biggest single-day point gain since March 2011 as investors were heartened by the dollar's rise to the 94 yen line at one point, following BOJ Governor Masaaki Shirakawa's announcement Tuesday evening that he will step down around three weeks before his term expires on April 8, together with his two deputies.

It is now expected that their replacements will share Prime Minister Shinzo Abe's view regarding easy monetary policy, boosting market expectations that so-called Abenomics will be carried out, said Hiroichi Nishi, assistant general manager of equity research at SMBC Nikko Securities Inc.

Nishi added a weaker yen further fueled expectations about better corporate earnings, lifting the shares of exporters such as auto and electronics makers.

Market sentiment was also buoyed after auto giant Toyota Motor Corp. on Tuesday revised up its group operating profit projections for fiscal 2012 ending March to 1.15 trillion yen, up 100 billion yen from its previous estimates, brokers said.

"Now that the Nikkei has topped the highest level since the slump triggered by Lehman Brothers' collapse, market players are expecting change after years of a range-bound market," said Tsutomu Yamada, market analyst at kabu.com Securities Co.

Also adding to the momentum were overnight rallies in European and U.S. stock markets on eurozone business sentiment data that beat market expectations, brokers said.

Among automakers, Toyota leapt 275 yen, or 6.1 percent, to 4,815 yen, Nissan jumped 41 yen, or 4.3 percent, to 996 yen and Honda rose 115 yen, or 3.3 percent, to 3,580 yen. Mazda was up 12 yen, or 4.4 percent, to 283 yen.

Other export-linked shares also fared well with Fanuc climbing 360 yen, or 2.5 percent, to 14,610 yen and Kyocera gaining 390 yen, or 4.9 percent, to 8,360 yen. Toshiba advanced 22 yen, or 5.6 percent, to 413 yen.

Defense-related shares enjoyed sizable gains amid heightened tension between China and Japan following a recent incident in which a Chinese frigate locked weapon-targeting radar on a Japanese warship in the East China Sea, brokers said.

Mitsubishi Heavy Industries rose 50 yen, or 10.3 percent, to 533 yen while Kawasaki Heavy Industries climbed 21 yen, or 7.5 percent, to 301 yen.

On the First Section, advancing issues outnumbered declining ones 1,366 to 238, while 94 remained unchanged.

Trading volume on the main section came to 4,616.84 million shares, down from Tuesday's 4,803.04 million shares.

(c) 2013 Kyodo News International, Inc.

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