Asian equity markets ended mostly higher on Monday on optimism that European officials will soon agree on a third bailout deal for Greece.
News emerged in the afternoon that European ministers will review a compromise proposal for a Greek bailout following fourteen hours of talks. The report quashed earlier fears of a 'Grexit' on the back of a German draft proposal that said "Greece should be offered swift negotiations on a time-out from the euro area."
The euro was little changed throughout the session, down 0.2 percent to around 1.11 per dollar.
Focus in Asia was also on Chinese trade figures, which showed exports rising 2.8 percent from a year earlier, beating expectations of a 0.2 percent fall. Despite the positive data, customs officials warned that exports are likely to face "relatively big pressure" in the coming months.
Meanwhile, Brent crude lost over 2 percent as talks for a Iranian nuclear deal continued. After two delays, the deadline has now been pushed to Monday, the Iranian foreign minister said over the weekend.
Shanghai extends rally
Mainland shares jumped more than 2 percent, extending gains after ending last week 6 percent higher as investors cheered Beijing's recent market boosting measures like the ban on state firms from selling holdings. The Shanghai Composite even briefly breached the 4,000 level for the fist time since July 2.
Brokerages were in focus after receiving instructions from regulators on Sunday to enforce the use of real names and national identification numbers on trades. Meanwhile, state-owned media outlet Xinhua reported over the weekend that some brokerages were suspected of manipulating futures prices and other "malicious" practices. Everbright Securities led gains by more than 2 percent.
In a report, JPMorgan issued a warning on Monday about the extent of government intervention: "While these measures are likely to be short-lived and one expects them to be removed once the market stabilizes, the interventions could discourage foreign institutional participation in the absence of more extensive corporate governance reforms and stronger minority shareholder protection."
Nikkei 1.6% higher
Japanese stocks got a boost after posting a near-4 percent loss for the week ending Friday despite a slightly stronger currency. The yen strengthened to 122 per dollar in early trade as investors flocked to the safe-haven asset.
Exporter stocks were the biggest winners on the benchmark Nikkei, with Panasonic, Sony and Sharp soaring 3-4 percent each, while Nintendo rallied 1.5 percent despite announcing that its president Satoru Iwata passed away. But Toshiba bucked the trend; shares lost 1.2 percent on on reports that the president may resign over an accounting scandal.
Construction machinery maker Takeuchi surged 9 percent to a record high after announcing a three-to-one stock split and dividend increase.
ASX down 0.3%
Australia's index erased gains in afternoon trade, extending losses after ending last week with a near 1 percent loss.
Banks swung between gains and losses as regulators said on Monday that lenders need to increase capital ratios in order to be "unquestionably strong." Australia New Zealand Banking fell 1 percent while Commonwealth Bank of Australia eased 0.7 percent.
Kospi up 1.5%
South Korean shares accelerated their gains in afternoon trade, with the Kospi index enjoying its biggest one-day rally in nearly three months, ending at a ten-day high.
Samsung C&T and Cheil Industries ended 1 and 2.5 percent higher, respectively, after the Seoul High Court said it would rule on U.S. hedge fund Elliott's request to block a merger of the two firms before July 17.