Japanese stocks rise on U.S. stimulus optimism

TOKYO, Oct 21 (Reuters) - Japanese shares closed higher on Wednesday as optimism that U.S. lawmakers could reach an agreement on a pre-election stimulus package lifted riskier assets globally.

The benchmark Nikkei share average settled 0.31% higher at 23,639.46, erasing some of Tuesday's losses with 188 advancers on the index against 35 decliners. The broader Topix gained 0.73% to 1,637.60.

All but two of the 33 sector sub-indexes on the Tokyo exchange finished higher. Cyclical iron and steel, miners and shippers were the three top performers on the main bourse.

Analysts said a rise in U.S. stock futures during Asian trade created a tailwind for the market. E-mini futures for the S&P 500 were last up 0.47%.

With just two weeks until the U.S. presidential election, lawmakers moved closer to agreement on a new coronavirus relief package as President Donald Trump said he was willing to accept a large aid bill despite opposition from his own Republican Party.

The news helped Wall Street finish higher overnight and buoyed sentiment in Asia.

Among the gainers in Japan, Shimachu soared by 14.54%, shy of its daily limit, after furniture retailer Nitori Holdings said it may bid for the home improvement retailer, threatening a tender offer by DCM Holdings.

Nitori and DCM were down 1.63% and 6.81%, respectively.

Shares of ANA Holdings ended 1.73% higher, despite reports that the coronavirus-battered airline operator was expected to post a net loss of 530 billion yen ($5 billion) for the fiscal year ending in March 2021. ANA said after market hours that the forecast was undecided.

Takara Bio Inc jumped 5.42% after the biotechnology company lifted its net profit forecast for the six months ended Sept. 30.

Nojima Corp gained 7.31% after upgrading its net profit outlook for the fiscal year ending in March 2021.

The Mothers Index of start-up firm shares reversed course to close 0.48% lower. (Reporting by Eimi Yamamitsu; Editing by Aditya Soni and Subhranshu Sahu)