The Japanese equities markets were up on Wednesday on heavy foreign buying as the Asian nation’s political turmoil began to ease.

The Nikkei 225 gained 1.7 percent to 12,098.08, its highest close since April 2004, while the Topix index closed 1.8 percent higher at 1,227,85, its highest close in four years.

Foreign buyers seemed to be accepting analysts’ opinions that Japan’s political troubles will not have any significant negative impact on the economy and could in fact be a positive factor in long-term economic growth.

There was also good news on several fronts. Machinery orders were strong, corporate goods price data pointed to an end of deflation, and the Cabinet Office monthly report contained a more positive assessment of the economy.

Foreign investors were especially interested in the machinery, steel, and textile sectors. Nippon Steel gained 1.4 percent to ¥292, and textile manufacturer Unitika was up 1.3 percent to ¥531. Quarterly reports also led to increases in share values. Mitsubishi Materials was up 6 percent on the day to ¥316 on the strength of its quarterly profits, which were reported on Monday.

Japan’s second biggest property developer, Mitsubishi Estate, gained 3.5 percent to ¥1,304 on a positive quarterly report. In the chemicals sector, Showa Denko gained 6 percent to ¥299 on a tripling of profits in the first half.

Retailers were up on the day as well, on reports that the political situation could delay implementation of a hike in the consumption tax. Department store chain Mitsukoshi added 2.7 percent to ¥531.

The New York stock markets were down on Thursday on profit-taking and on reports that retail sales in the United States were generally down in July.

The Dow Jones Industrial Average fell 0.8 percent to 10,610.10, the Nasdaq composite index was down 1.2 percent to 2,191.32, and the S&P 500 lost 0.7 percent to 1,235.86.

In the retail sector, Wal-Mart was down 0.8 percent to $49.29 even though same-store sales were up by 4.4 percent in July.

The Gap was down 1.2 percent to $20.69, Limited Brands fell 2.7 percent to $24.35, and Nordstrom, which has gained nearly 70 percent in the past year, declined by 8.2 percent to $33.45.

The Gap, Limited Brands, and Nordstrom all reported lower-than-expected sales in the second quarter. The retail sector as a whole was down 2.2 percent on these results for the worst performance in a sector on the day.

Elsewhere, HSBC Holdings agreed to buy credit card company Metris, sending shares in both companies down on the day. HSBC Holdings fell 0.8 percent to $81.90, while Metris lost 2.6 percent to $14.46.

In Tokyo on Monday, the Nikkei 225 was up 0.6 percent to 11,762.65 and the Topix gained 0.3 percent to 1,190.27 on the strength of sectors that stand to gain by the revaluation of the Chinese renminbi.

Nippon Steel gained 0.7 percent to ¥277, while JFE Holdings, was up 0.5 percent to ¥2,915, taking the iron and steel sector as a whole up by 0.8 percent.

The textile sector, which could receive a competitive advantage from the revaluation, gained 0.6 percent as a whole as Japan’s largest general textile manufacturer, Unitika, was up 1.4 percent to ¥148.

Meanwhile, Matsui Securities lost 3.8 percent to ¥1,054 after announcing on Friday that its quarterly profits were down by 15 percent.

Takeda Pharmaceutical, on the other hand, gained 1.1 percent to ¥5,600 on the news that the US has approved the sale there of Takeda’s prescription sleeping pill Rozerem.

In the oil sector, AOC Holdings gained 6 percent to ¥1,697 at least partly on a report that it’s oil producing unit will begin pumping crude oil at two locations in Egypt in the second half of 2007.

Nippon Oil, however, lost 0.1 percent to ¥741. Nippon is Japan’s biggest oil distributor.