Japan's Nikkei surges after Wall Street rally; BOJ decision awaited

The BOJ's announcement does not come at a set time, but is expected around 0330-0430 GMT.

The central bank is likely to hold the key rate steady at 1% and signal its resolve to continue pushing up borrowing costs as mounting price pressures from a weak yen and the Middle East conflict risk driving underlying inflation above its target.

Japan's Nikkei share average jumped more than 4% on Friday, buoyed by a rally on Wall Street as Microsoft MSFT.O led a rebound in tech shares after delivering forecasts that eased fears about the industry's massive AI infrastructure spending.

The Bank of Japan is widely expected to keep monetary policy steady later in the day.

The Nikkei .N225 ended the morning session up 4.4% at 64,572.25 after surging as much as 5.7% at one point. The broader Topix .TOPX rose 1.5%.

Chip-testing equipment manufacturer Advantest 6857.T soared 17% and AI-focused startup investor SoftBank Group 9984.T leapt more than 15%.

Overnight, the U.S. S&P 500 .SPX gained 1.7% and the tech-heavy Nasdaq .IXIC climbed 2.8%. Microsoft surged 15.5% after forecasting quarterly sales and cloud growth above expectations.

"It confirmed continued strong demand for AI," said Nomura strategist Maki Sawada.

"The U.S. rally is having a big impact on Japanese shares today."

Japanese intervention to prop up the yen on Thursday, which catapulted the currency as much as 3.6% from near a four-decade low to the U.S. dollar, has largely been ignored by the stock market, Sawada said.