TOKYO, Jan 18 (Reuters) - Japanese shares rose on Tuesday, tracking a solid finish in European markets, as investors continued to buy back growth stocks, though caution ahead of an outcome of the Bank of Japan"s policy meeting capped further gains. The Nikkei share average (.N225) was up 0.8% at 28,566.23, as of 0207 GMT, and the broader Topix (.TOPX) was up 0.58% at 1,998.35. "Gains in European stocks lifted the market sentiment and investors bought back large stocks," said Ikuo Mitsui, fund manager at Aizawa Securities. European shares recovered on Monday as investors focused on company earnings and U.S. Federal Reserve policymakers entered a quiet period ahead of their meeting next week, while the U.S. market was closed. . Back home, Uniqlo clothing store owner Fast Retailing (9983.T) rose 3.46%, and chip-making equipment maker Tokyo Electron (8035.T) climbed 1.63% and technology start-up investor SoftBank Group (9984.T) advanced 1.86%. Hitachi Construction Machinery rose 2.47% after slumping about 12% in the past week, as its parent Hitachi said it would sell about half of its stake in Hitachi Construction. read more Japanese railway operators (.IRAIL.T) and airliners (.IAIRL.T) managed to climb 0.9% and 0.56%, respectively, even as Tokyo and its surrounding prefectures have sought further measures from the central government to help counter rising COVID-19 infections. read more "But today investors are also cautious as they await the outcome of the Bank of Japan"s policy meeting," Mitsui said. The central bank will probably slightly revise up its inflation forecast in a quarterly outlook report due to rising energy costs, Reuters had reported last week. read more Steel makers were the worst performers on the Nikkei, with Nippon Steel losing 5.72%, JFE Holdings (5411.T) dropping 5.11% and Kobe Steel 5406.T> falling 5.02%.