TOKYO (Kyodo) -- Tokyo stocks ended sharply higher Wednesday, driven by gains in semiconductor-related shares following news that SoftBank Group will join a major artificial intelligence investment project in the United States.

The 225-issue Nikkei Stock Average ended up 618.27 points, or 1.58 percent, from Tuesday at 39,646.25. The broader Topix index finished 23.69 points, or 0.87 percent, higher at 2,737.19.

On the top-tier Prime Market, gainers were led by nonferrous metal, miscellaneous product and machinery shares.

The U.S. dollar was mostly capped in the upper 155 yen range amid speculation that the Bank of Japan will raise its short-term interest rate at its two-day policy meeting later this week.

Stocks stayed firmly in positive territory throughout the day, as heavyweight technology-related issues boosted the market after U.S. President Donald Trump announced SoftBank Group would be part of the $500 billion project with OpenAI and Oracle Corp., analysts said.

The announcement highlighted potential investor benefits under a Trump presidency, while easing tariff concerns spurred broad-based buying, said Makoto Sengoku, senior equity market analyst at Tokai Tokyo Intelligence Laboratory Co.

"While the possibility of universal U.S. tariffs still remains, (Trump's) announcements have focused on regions like Europe and China. As Japan hasn't been mentioned, the risk of excessive tariff policy impacts appears relatively limited for now," Sengoku said.

Trump said Tuesday that he is considering imposing an additional 10 percent tariff on Chinese imports, probably from Feb. 1, while saying Europe could face similar measures.