Tokyo  - Stocks in Tokyo gained ground Friday despite a government report saying industry output recorded its sharpest fall in history.

The benchmark Nikkei 225 Stock Average climbed 140.02 points, or 1.63 per cent to close at 8,739.52.

The broader Topix index of all first-section issues rose 10.56 points, or 1.26 per cent, to 846.58.

Japan's Ministry of Economy, Trade and Industry said industry output dropped by 8.1 per cent in November from the previous month, the biggest drop since recording began in 1953, as slowing global demand hit Japan's export-oriented industry.

Investors, however, took the news calmly, traders said, as they were already expecting less-than-encouraging data.

On currency markets at midday (0300 GMT), the dollar was quoted at 90.45-50 yen, up from Thursday's 5 pm quote of 90.35-40 yen.

The euro was quoted at 1.4012-17 dollars, compared to 1.4015-17 dollars late Monday, and at 126.75-85 yen, up from 126.63-67 yen. (dpa)