Asia markets closed higher on Monday, bolstered by election results in Japan and Australia and shrugging off concerns a strong U.S. jobs report might push the Federal Reserve closer to hiking rates.
Japan's Nikkei 225 closed up 601.84 points, or 3.98 percent, at 15,708.82, while the Topix closed up 45.91 points, or 3.79 percent, at 1,255.79. Those gains came as the yen relatively weakened against the dollar, trading at 101.88 as of 3:12 p.m., compared with the dollar earlier fetching as little as 100.42 yen.
In upper house elections on Sunday, Prime Minister Shinzo Abe's ruling coalition won in a landslide, in a development analysts said was likely to make it far easier to push through his economic agenda, dubbed Abenomics.
"It is likely that a large-scale economic stimulus program, in the magnitude of at least 10 trillion yen (2 percent of gross domestic product), will be implemented in order to restart Abenomics," Societe Generale said in a note Monday. "Some of the measures to be included in the package will be policies to reduce economic inequalities among the citizens and regions of Japan."
Australia's ASX 200 closed up 106.56 points, or 2.04 percent, at 5,337.10, boosted by a 2.47 percent gain in the financials subindex that makes up nearly half of the broader index. Major Australian banks rallied, with shares of ANZ climbing 3.46 percent. The Australian dollar traded at $0.7547 in the evening local time, coming off an earlier high of $0.7575.
On Sunday, Australia's Prime Minister Malcolm Turnbull declared his ruling coalition won the extremely close election, although the counting of votes continued more than a week after the actual vote.
"Resolution of the ambiguous federal election result over the weekend is helping the Australian dollar remain buoyant," Anthony Darvall, chief market strategist at spreadbettor easyMarkets, said in a note.
Others agreed. "With the Liberals now set to return to government, from a budgetary perspective, this will ease concerns of 'across the political floor' squabbling," Stephen Innes, senior trader at Oanda Asia Pacific, said in a note Monday.
Hong Kong's shares joined the regional rally, with the Hang Seng Index up 1.52 percent in late-afternoon trade. On the mainland, the Shanghai Composite added 7.94 points, or 0.27 percent, to 2,996.04, while the Shenzhen composite dropped 11.30 points, or 0.56 percent, to 2,000.97. In South Korea, the Kospi added 25.44 points, or 1.3 percent, to 1,988.54.
In the U.S. on Friday, the nonfarm payrolls report showed that the U.S. created 287,000 jobs in June, compared with the 175,000 expected by economists surveyed by Reuters. The unemployment rate edged higher to 4.9 percent from May's 4.7 percent, coming slightly above the the 4.8 percent expected.
Despite the better-than-expected jobs report for June, analysts said it wouldn't be enough to push the U.S. Federal Reserve to raise interest rates.
"Abstracting from monthly noise, jobs growth averaged a solid 147,000 a month over the last three months, telling us that the U.S. economy is doing well," Shane Oliver, head of investment strategy and chief economist at AMP Capital, said in a Friday note after the report.