Share prices closed higher, with the benchmark Nikkei index surging to a new four-year peak, as investors continued to snap up shares in the belief that the Japanese economy is heading toward steady growth, dealers said. The blue-chip Nikkei 225 closed up 20.42 points or 0.2 pct at 12,472.93, its highest close since July 5, 2001, when it rose to 12,607.30. At one stage, blue chip marker surged to 12,612.16. The broader-based TOPIX index of all First Section issues added 2.18 points or 0.2 pct to 1,272.00, off a high of 1,283.23. Gainers beat losers 812 to 692, with 144 issues unchanged. Trading was active, with volume reaching 2.24 bln shares, up from 1.95 bln yesterday. "Global investors, including those here, are pouring their money into shares here on expectations that the Japanese economy is emerging from prolonged deflation," said Hiroichi Nishi, equity general manager at Nikko Cordial Corp. Mizuho Investors Securities senior strategist Masatoshi Sato said that the gains are partly because foreigners expect that Prime Minister Junichiro Koizumi will win the general election on Sept 11 and accelerate his reform drive. Toyo Securities strategist Ryuta Otsuka also attributed the rise in the benchmark indices here to investors scrambling to buy shares for fear that they will otherwise miss the train. "However, the Nikkei index narrowed its earlier gains after surging above the 12,600 mark briefly as the blue chip marker succumbed to bouts of profit-taking, led mainly by banks," Otsuka said.