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

       TOKYO (Kyodo) -- Tokyo stocks ended higher Tuesday, as some blue chips and steelmakers attracted buying as undervalued stocks in cautious trading, with market focus remaining on a possible extension of a COVID-19 state of emergency.

       The 225-issue Nikkei Stock Average ended up 300.25 points, or 1.08 percent, from Monday at 28,089.54, the highest close since July 15. The broader Topix index of all First Section issues on the Tokyo Stock Exchange finished 10.56 points, or 0.54 percent, higher at 1,960.70.

       Gainers were led by marine transportation, iron and steel, and precision instrument issues.

       The U.S. dollar was steady in the upper 109 yen range after an overnight record close for the technology-heavy Nasdaq index lifted risk appetite, dealers said.

       At 5 p.m., the dollar fetched 109.81-83 yen compared with 109.87-97 yen in New York and 109.80-82 yen in Tokyo at 5 p.m. Monday.

       The euro was quoted at $1.1827-1828 and 129.88-92 yen against $1.1792-1802 and 129.61-71 yen in New York and $1.1801-1803 and 129.58-62 yen in Tokyo late Monday afternoon.

       The yield on the benchmark 10-year Japanese government bond inched up 0.005 percentage point from Monday's close to 0.020 percent as investors sold the safe-haven debt after the rise in Tokyo stocks helped improve their risk appetite. Bond yields move inversely to prices.

       Stocks initially tracked an overnight decline for the Dow Jones Industrial Average amid consecutive days of record-high serious coronavirus infection cases in Japan.

       But once initial selling ran out of steam, the market moved into positive territory led by a surge in some blue chips, including Fast Retailing and SoftBank Group, brokers said.

       "The market had been going through an anomaly which saw stocks end lower at the end of each month for 11 months straight, so sentiment improved as shares trimmed losses toward yesterday's closing level to break the jinx, and (traders) snapped up bargains," said Masahiro Ichikawa, chief market strategist at Sumitomo Mitsui DS Asset Management Co.

       Still, a possible extension of the COVID-19 state of emergency on the back of the high number of infections logged daily in Japan continued to weigh on the market, he added.

       Health minister Norihisa Tamura said Sunday it would be "very difficult" to lift the COVID-19 state of emergency, currently covering 21 prefectures, on its planned Sept. 12 expiration, as the country struggles to contain surging coronavirus infections amid a strain on the medical system.

       On the First Section, advancing issues outnumbered decliners 1,047 to 1,017, while 125 ended unchanged.

       Among blue chips, Fast Retailing climbed 1,490 yen, or 2.1 percent, to 72,520 yen, and SoftBank Group rose 29 yen, or 0.5 percent, to 6,181 yen.

       Steelmakers were mostly higher following a bout of recent selling. Nippon Steel rose 79.5 yen, or 3.7 percent, to 2,248.0 yen, and JFE Holdings advanced 57 yen, or 3.3 percent, to 1,785 yen.

       Meanwhile, land and air transportation issues fell as concerns over the possible emergency extension may continue to reduce the number of travelers.

       Odakyu Electric Railway declined 86 yen, or 3.2 percent, to 2,564 yen, while ANA Holdings sank 55.0 yen, or 2.1 percent, to 2,605.5 yen.

       Trading volume on the main section rose to 1,235.24 million shares from Monday's 1,021.74 million shares.

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