Japan's Nikkei rises for fifth session on AI rally, dividend hunt

By Junko Fujita

TOKYO, Sept 25 (Reuters) - Japan's Nikkei share gauge rose for a fifth straight session on Friday, driven by gains in AI-related companies and as investors bought ahead of a Monday deadline to qualify for mid-term dividends.

The benchmark Nikkei 225 .N225 advanced 1.30% to close at 66,364.20, rising just over 2% in the holiday-shortened week. The broader Topix .TOPX climbed 1.31% to 4,128.59.

"Investors picked up stocks to secure the right to dividend payouts, but moreover, the demand for chip-related stocks supported the market," said Daisuke Hashizume, a senior strategist at Daiwa Securities.

Bank shares, which typically pay higher dividends, were the top performers among the Tokyo Stock Exchange's (TSE) 33 industry sub-indexes, rising 4.08%.

Mitsubishi UFJ Financial Group 8306.T rose 3.95%, while Sumitomo Mitsui Financial Group 8316.T climbed 3.59%.

Chip-related Tokyo Electron 8035.T and Advantest 6857.T rose 4.82% and 2.84%, respectively, providing the biggest source of the Nikkei's gain.

Ibiden 4062.T, a central processing unit component maker, rose 4.2% after jumping 14.57% in the previous session.

Solid economic data supports the strength of technology stocks, said Daiwa's Hashizume.

"And the central banks in the United States and Japan made it clear that they would fend off inflation by raising rates, which boosted investor confidence in stocks," he said.

Technology investor SoftBank Group 9984.T fell 3.18% after shares of Oracle ORCL.N slipped 3% overnight, following a report that Oracle issued a "force majeure" notice to a Blue Owl OWL.N unit, the developer of a large New Mexico data centre, citing potential delays in securing power for the project.

SoftBank is a co-investor in the "Stargate" infrastructure project together with Oracle and OpenAI.

There were 171 advancers on the Nikkei 225 against 51 decliners and 3 unchanged.