The Nikkei 225 Index climbed 1.1% to surpass 37,800, while the broader Topix Index gained 1% to 2,745 on Thursday, marking a second consecutive session of gains.

The rally followed US President Donald Trump's announcement of a one-month exemption for automakers from his 25% tariffs on imports from Canada and Mexico.

The White House also indicated that Trump is open to further tariff concessions, easing concerns about potential economic fallout. Meanwhile, Bank of Japan Deputy Governor Shinichi Uchida stated this week that the central bank could raise interest rates further if its forecasts are met, emphasizing that the exit from its extensive monetary easing program is just beginning.

Export-driven stocks led the rally, with notable gains from Mitsubishi Heavy Industries (+8.5%), Kawasaki Heavy Industries (+7.2%), Hitachi (+3%), Sony Group (+3%), and Honda Motor (+2.8%).

Source: Trading Economics