Stock prices on Japan's benchmark Nikkei index have pushed past the psychologically important 10,000 level for the first time in a fortnight.

The index rose more than 2% on Monday, climbing for the fifth session in a row.

Foreign investors are returning to the Japanese stock market as fears ease about the future of the US economy, which is Japan's biggest trading partner, traders said.

The Nikkei closed up 200 points at 10,067 points.

Japanese optimism looks unlikely to feed into higher European share prices. A bank holiday in the UK has helped make already light volumes even thinner. The Paris Cac index opened a touch lower at 3,514 points while Germany's Dax index opened a few points higher at 3,842 points.

Hopes for recovery

"The US economy looks to have bottomed out and investors are reacting by buying back Japanese stocks as prospects improve," said Ban Yew Wee, a fund manager for Singapore investment house OCBC Asset Management.

The last time the Nikkei rose above the 10,000 level was 9 August.

Its climb past the psychologically significant level comes after a similar breakthrough on New York's Dow Jones index last week.

In a sign that investors' fears about the US economy and corporate sleaze may be weakening, the Dow Jones closed above the 9,000 level last Thursday for the first time in six weeks.

The Dow lost ground again on Friday, closing down 2% at 8,872 points.

Wait and see

Whether Japan's stock market continues to recover is likely to depend heavily on data on the long-sluggish Japanese economy's growth rate in April, May and June.

Economists expect Japan to show 0.2% growth in gross domestic product (GDP) when the figures are released on 30 August.

Shares in car maker Nissan, which is an affiliate of French firm Renault, climbed 2.6% on Japanese press reports it will post 48% jump in first half profit. Nissan has declined to comment.

Shares were generally lower elsewhere in Asia.

Taiwan's leading index fell nearly 1%, knocked by US brokers' cuts in profit forecasts for giant US chip-maker Intel, which hit the price of shares in the world's two biggest contract chip makers.