[TOKYO] Japanese shares soared on Friday, with the broad Topix index hitting a three-decade high, after Prime Minister Yoshihide Suga offered to resign, opening the way for a fresh government that could help the ruling party win an upcoming election.

Nikkei share average rose 1.7 per cent to 29,020, reaching its highest level since June, while the Topix vaulted as much as 1.7 per cent to 2,017.00, reaching a level last seen in April 1991.

The market has been rallying this week on hopes for a stronger government ahead of a ruling party leadership race and a general election later this year.

Kyodo News reported Mr Suga will step down and party sources said he would not run in a ruling party leader race in September, setting the stage for his replacement after just one year in office.

REUTERS