Nikkei jumps 2% on Wall Street's lead; BOJ decision looms

After Wall Street gains: Nikkei share average jumped more than 2 per cent in the morning session on Friday, tracking overnight gains on Wall Street, while traders also kept a wary eye ahead of the Bank of Japan's policy decision later in the day.

The tech-heavy Nikkei was up 2.05 per cent at 37,915.87, as of 0156 GMT, with chip-sector stocks rallying in line with US equities' upbeat moves overnight. Shares of chip-making equipment giant Tokyo Electron soared 5.8 per cent on Friday.

A weaker yen also provided support to Japanese equities, as it boosts the value of overseas revenues among the country's many heavyweight exporters. Toyota Motor advanced 1.5 per cent and Honda jumped 2.8 per cent. The broader Topix index gained 1.49 per cent.

US stock indexes climbed to record highs on Thursday, a day after the Federal Reserve delivered an outsized interest rate cut, saying the US economy remained strong and expressing greater confidence inflation was under control. 

The BOJ is widely expected to keep monetary policy steady on Friday, while signalling confidence in its ability to keep raising rates in coming months. "Worries about the US economy are receding," supporting equities broadly and tech stocks in particular, after they had "sold off too much," said Kazuo Kamitami, a strategist at Nomura Securities. 

No change in BOJ policy is the "main scenario," but "what happens to the exchange rate will be watched very closely," Kamitani added. The Yen was changing hands at 142.38 per dollar , after retreating steadily from a 14-month peak of 139.58 reached on Monday.

The time of the BOJ announcement is not set, but typically comes around 0300-0430 GMT. Stocks are in the midday recess from 0230-0330 GMT. BOJ Governor Kazuo Ueda is due to brief media at 0630 GMT, after the market close.

Investors may be extra cautious ahead of a long weekend, with Japan shut for a national holiday on Monday. Of the Nikkei 's 225 components, 193 rose, 31 fell and one was trading flat.