Japan's Nikkei 225 share average struck a 15-year high on 19 February, and with no approaching headwinds, analysts expect Japanese equities are likely to continue climbing higher.

The benchmark index hit the peak in intra-day trade and finished at 18,264.79 points. The index has gained 4.66% this year and some 27% over the past 12 months.

Daiwa senior technical analyst Hikaru Sato told CNBC that in addition to improving fundamentals, such as rising exports, the return of stability to the crude oil markets had helped drive up stock prices in Tokyo.

Sato said he expects the Nikkei to hover between 19,500 and 20,000 in April and at around 22,000 by autumn this year.

Meanwhile, Mizuho Securities' chief technical analyst Yutaka Miura said he expects the Nikkei to test the 19,500 to 20,000 range around May.

Analysts said a notable difference between the latest rally from the ones last year was that the tight correlation between a weaker yen and higher Nikkei stock prices appeared to be loosening.

Sato said: "The weaker yen scenario has run its course. Foreign investors are focused on stronger profitability at Japanese exporters."

Miura told the news channel: "Investors are buying Japanese stocks on the fundamentals. The economy is out of recession, wages look set to rise and corporate earnings growth looks strong."

Government data showed that exports jumped 17% year-on-year in January.


But not everyone is as optimistic about Japan's economy, the world's third-largest, and Japanese equities.

Societe Generale Cross Asset Research said in a note: "Doubts on the ability of PM [Shinzo] Abe to repair Japan are on the rise.

"Subdued growth is the central scenario: even after a 35% fall in the yen from its 75 high against the USD, and even after the USD1,300bn injected since November 2012, SG economist Takuji Aida expects 2015 growth to be a humble 1.6%.

"The latest disappointing GDP print (2.2% vs 3.7% expected) only adds to the uncertainty."

Earlier, SocGen, citing the broader Topix index's 102% gain since the end of 2012, said in a note that "Japan is no longer a deep value story".

Japanese stocks were rangebound in December 2014, after rallying in November and October.

The Nikkei's all-time high of 39,815 points was seen on 29 December, 1989.