This file photo shows the Tokyo Stock Exchange. (Mainichi)

       TOKYO (Kyodo) -- Tokyo stocks finished sharply higher on Tuesday, with the Nikkei index surging 2 percent, as investors bought on dips following a large fall over the past two trading sessions, with gains in blue chips boosting the market further.

       The 225-issue Nikkei Stock Average ended up 579.78 points, or 2.08 percent, from Monday at 28,517.59. The broader Topix index of all First Section issues on the Tokyo Stock Exchange finished 28.46 points, or 1.47 percent, higher at 1,969.79.

       Every industry category gained ground, led by marine transportation, securities house and rubber product issues.

       The dollar remained firm in the upper 113 yen range as the unit was bought following an overnight rise in U.S. Treasury yields that fueled speculation the interest rate gap between the United States and Japan will widen, dealers said.

       Tokyo stocks rebounded sharply in the morning and extended gains later in the day, after the Nikkei index finished below the 28,000 threshold Monday for the first time since Dec. 6.

       The Nikkei index dropped more than 1,100 points, or nearly 4 percent, over the previous two trading days on concerns over the Omicron variant of the coronavirus that has spread around the world.

       "Japanese stocks were sold much more than they should have been and there was an impression among investors that it went too far," leading traders to buy a variety of stocks, said Toshikazu Horiuchi, an equity strategist at IwaiCosmo Securities Co.

       Brokers said a rise in some Asian markets and U.S. stock futures lifted investor sentiment, while blue-chip Tokyo Electron and Fast Retailing shares were bought following sharp drops on Monday and last Friday.

       Fast Retailing, the operator of the Uniqlo clothing chain, added 1,790 yen, or 2.7 percent, to 68,350 yen, while Tokyo Electron rose 2,620 yen, or 4.4 percent, to 62,220 yen.

       Some semiconductor issues were bought following an upbeat earnings report from major U.S. chipmaker Micron Technology that beat market expectations, brokers said.

       Advantest was up 470 yen, or 4.6 percent, at 10,670 yen, and Taiyo Yuden climbed 190 yen, or 3.0 percent, to 6,490 yen.

       Pharmaceutical company Shionogi jumped 409 yen, or 5.3 percent, to 8,121 yen after it said Monday it had confirmed the efficacy of its oral COVID-19 drug currently in development against the Omicron variant.

       On the First Section, advancing issues outnumbered decliners 1,673 to 430, while 81 ended unchanged.

       Volume on the main section fell to 1,015.66 million shares from Monday's 1,142.33 million shares.

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