The Nikkei 225 closed 0.59% higher at 70,474.96 on Wednesday, marking the third straight day of positive returns for Japan's flagship equity index.
The advance was underpinned by robust buying interest in artificial intelligence-related shares, which continued to offset broader market anxiety stemming from geopolitical developments in the Middle East.
While the technology sector provided a clear bid, the rally faced resistance from investors wary of an ongoing impasse in US-Iran negotiations.
The diplomatic stalemate has reintroduced uncertainty into global risk sentiment, acting as a counterweight to the domestic tech-driven momentum.
This dynamic reflects a broader pattern in Asian markets this week, where early optimism fueled by peace hopes has been tempered by reports of stalled talks.
The divergence between sector-specific strength and macro-level caution highlights the current market regime.