Asia Markets

Japan leads Asian gains after S&P's record high; Earnings in focus

Asian equity markets kicked off the week on a strong footing following record highs on Wall Street and as attention turned to the region's corporate earnings season.

Australia's rose to a new five-year high, Japan's Nikkei jumped over 2 percent while South Korean stocks were both modestly higher. In China, the Shanghai Composite managed to reverse earlier losses to enter positive territory.

A 64-point rise in Dow stock futures also underpinned gains in Asia.

(Read more: A central-bank weekfor Asian markets)

US gains support

Asian investors took their cues from a strong handover from Wall Street, where the ended at 1,759 points on Friday, a fresh record high. U.S. data is in focus after consumer sentiment slid to to 73.2 in October, its lowest level since December 2012.

(Read more: S&P 500 maystill have further 15% upside)

Caution may set in ahead of the U.S. Federal Reserve's policy-setting meeting this week. Most market watchers expect the central bank to hold off on any reduction in its $85-billion-a-month bond-buying program until next year, which will likely add pressure on the U.S. dollar index.

(Read more: Dollar braces for dovish Fed, gloomy US data)

"In any case, the Fed will probably consider it way too premature to initiate 'taper' just yet. As such, we expect this week's FOMC to be uneventful," said Vishnu Varathan of Mizuho Bank.

Nikkei rallies 2.2%

Japan's benchmark index enjoyed a strong rebound from a two-and-a-half-week low hit on Friday as the yen moved closer to the 98 handle against the greenback.

Top steelmaker JFE Holdings slid 1.3 percent after leaving its full-year profit forecast unchanged last week while telecommunications firm KDDI and construction equipment maker Komatsu climbed 3 and 2.6 percent, respectively before reporting quarterly earnings later in the day.

Mitsubishi Motors jumped 4 percent after announcing that it plans to raise around $2 billion in a public share offering as early as January.

Mizuho Financial rose 2.4 percent following weekend reports that the lender plans to punish several senior executives for failing to take responsibility for loans to organized crime groups. Mizuho said later that the chairman of its banking unit resign while its president will take a six-month pay suspension following the scandal

Sydney up 1%

Australian equities closed at their highest level since 2008 thanks to strong gains in financials.

"I see the momentum continuing this week however, the price action leads me to believe the market is starting to be priced to perfection and the momentum may turn post-bank earnings reports," said Evan Lucas, market strategist at IG in a morning note.

Bendigo & Adelaide's 2014 growth strategy

Australia and New Zealand Banking led gains by nearly 2 percent while National Australia Bank and Commonwealth Bank of Australia closed up over 1 percent each before releasing earnings later this week.

Macquarie added 1.5 percent as it plans an aggressive push into the home mortgage sector.

Rio Tinto increased 1 percent after agreeing to sell its 50.1 percent stake in its Clermont Mine to GS Coal, a company jointly owned by Glencore Xstrata and Sumitomo.

Shanghai flat

China's benchmark index reversed losses to cross 2,130 points but still traded within sight of Friday's seven-week low, weighed down by steep declines in resource stocks as as investors engaged in profit taking.

(Read more: Chinese stocks: Timeto take profit?)

Yangquan Coal and Lu'An Environmental Energy fell over 3 percent each despite Brent crude snapping a four-day losing streak.

Financials are in focus after China Construction Bank's third quarter net profit increased by a lower-than-expected 9.4 percent, its weakest growth in five years. CCB shares ended flat percent while mid-tier lender Minsheng Bank fell 1.1 percent.

Data over the weekend showed an 18.4 percent annual jump in profits for Chinese industrial firms in September but that figure was slower than the 24.2 percent jump seen in August.

Kospi rises 0.7%

Seoul's share market edged higher on strong foreign buying, leading to over 2 percent gains for market heavyweights Hyundai Motor and Samsung Electronics.

But a stronger currency capped gains on the Kospi. The traded at 1,060 per dollar, close to the nine-month high of 1,055 it hit against the greenback earlier this month.

In earnings news, KB Financial fell 1 percent despite announcing that its July-September operating profit rose an annual 5.1 percent while SK Hynix jumped 1.5 percent before reporting third-quarter results Tuesday.

Indian shares close at 1-1/2 week low

Indian shares fell on Monday for a fifth consecutive session to mark their lowest close in nearly 1-1/2 weeks, as lenders and other interest rate-sensitive shares declined ahead of the central bank's monetary policy review on Tuesday.

State Bank of India Ltd. provisionally fell 2.7 percent, while DLF Ltd. ended 3.6 percent lower.

The benchmark index provisionally fell 0.5 percent, falling for a fifth straight session after hitting a string of near-three year highs last week.

The broader NSE index closed down 0.55 percent.

Reuters contributed to this report