The Nikkei 225 Index gained 0.5% to surpass 37,900, while the broader Topix Index rose 0.4% to 2,807 in post-holiday trade on Friday. Japanese stocks advanced as they caught up with global market gains, following the US Federal Reserve's signal of two interest rate cuts this year.

Fed Chair Jerome Powell also reassured markets that tariff-driven inflation is likely "transitory." Both the Nikkei and Topix are on track to climb over 2% and 3%, respectively, for the week. In economic data, Japan's core inflation slowed to 3% in February from 3.2% in January but still exceeded forecasts of 2.9%.

This marked the second consecutive month that inflation came in above expectations, underscoring persistent price pressures and strengthening the case for further interest rate hikes.

Among notable gainers, Mitsubishi UFJ jumped 3.8%, Sanrio surged 4.5%, while Fujikura (2.4%), Sony Group (2.7%), and SoftBank Group (2.4%) also posted solid gains.

Source: Trading Economics