Asia markets advanced on Wednesday, extending a global rally that pushed major U.S. indexes to records amid expectations of further easing from Japan and the resolution of some concerns over the U.K. political muddle.
Japanese stocks got a boost from a weaker yen amid expectations that a double-bazooka of fiscal and monetary easing was on the cards after Prime Minister Shinzo Abe's coalition won a landslide victory in upper house elections over the weekend.
Abe pledged a fresh round of fiscal stimulus spending following his election victory and analysts broadly expect the Bank of Japan would again turn on the monetary policy spigots.
That helped to weaken the Japanese yen, with the dollar fetching 104.31 yen on Wednesday after trading near the 100 handle late last week. The currency pair was off an earlier high of 104.88.
The yen's relative weakness gave export stocks in Japan a boost, with shares of Toyota up 3.4 percent, Nissan higher by 1.1 percent and Toshiba adding 2.32 percent. Sony shares fell 2.13 percent, after retracing earlier gains of more than 1 percent.
"After being faced with the prospect of a major slowdown in global activity in the wake of the Brexit vote, governments and central banks worldwide are now expected to do their utmost to reassure markets and provide stimulus," said Angus Nicholson, a market analyst at brokerage IG, adding that this expectation partly explained the global rally in equities.
Australia's ASX 200 closed up 35.28 points, or 0.66 percent, at 5,388.50, boosted by gains in the energy, materials and financials sub-indexes.
Mining stocks in the country were mostly higher after iron ore prices rose more than 6 percent to $58.80 a tonne overnight. BHP Billiton was up 3.26 percent, while Fortescue added 5.52 percent and Rio Tinto was up 2.79 percent.
In Hong Kong, the Hang Seng index was up 0.51 percent. Chinese mainland markets also finished in positive territory, with the Shanghai composite closing up 10.83 points, or 0.36 percent, at 3,060.21 and the Shenzhen composite was higher by 16.64 points, or 0.82 percent, at 2,041.66. In South Korea, the Kospi gained 14.32 points, or 0.72 percent, at 2,005.55.
Concerns over political anarchy in the U.K. eased on Tuesday as U.K. home Secretary Theresa May looked set to be installed as the new prime minister this week, after rival Andrea Leadsom dropped out of the contest, leaving May the only candidate. That eased concerns that the U.K. was rudderless in the wake of David Cameron's resignation as prime minister in the wake of the referendum vote to exit the European Union (EU).
"Risk sentiments are riding high on easing fears of brutal 'Brexit' fallout," Mizuho Bank's senior economist Vishnu Varathan said in a note Wednesday. "Her promise of a successful 'Brexit' is inspiring hopes of a sensible compromise that will not unnecessarily dent the economy."