TOKYO, April 27 (Reuters) - Japan's Nikkei closed above

the key 60,000 mark for the first time on Monday as optimism

over corporate earnings overshadowed concerns about the Middle

East conflict.

The benchmark Nikkei 225 Index rose 1.38% to finish

the session at an unprecedented 60,537.36. The broader Topix

climbed 0.5% to 3,735.28. The Nikkei has gained 18.6% so

far this year.

Major indexes on Wall Street closed at record highs on

Friday after Intel ( INTC ) beat its earnings estimate, helped

by surging demand in the artificial intelligence sector. The

Philadelphia SE Semiconductor Index extended its record

run of gains to 18 consecutive sessions.

Shares of factory automation provider Keyence ( KYCCF ) and

industrial robot maker Fanuc ( FANUF ) surged by their daily

trading limit, nearly 16%, to lead gains in the Nikkei after

both firms reported better-than-expected profit after the bell

on Friday.

"Stocks related to earnings announcements, as well as AI and

semiconductor-related shares, led the market higher at the

open," said Maki Sawada, an equities strategist at Nomura

Securities. "This week will see a steady stream of earnings

reports from major companies in both Japan and the U.S., so

market attention will naturally gravitate toward those results."

"Since 60,000 is a psychological milestone, many investors

are likely keeping an eye on that level, so profit-taking could

manifest around that range," she added.

The Nikkei fell into negative territory shortly after the

open, but then rallied sharply following an Axios report that

Iran has given the United States a new proposal to end their

war. Discussions to settle the two-month-long conflict were

stalled over the weekend.

There were 94 advancers in the Nikkei index against 130

decliners. SMC was among the top gainers, rising 7.1%,

after Reuters reported that activist fund Palliser Capital had

made a "significant" investment in the factory automation

company.

Rohm ( ROHCF ) was among the steepest decliners, down 9.19%,

after auto parts maker Denso Corp ( DNZOF ) said it was

considering withdrawing its takeover offer for the firm.