The rest of Asian markets finished mixed on Tuesday after a stronger dollar and falling oil prices overnight tapered U.S. gains.
Japan's Nikkei 225 closed up 130.83 points, or 0.76 percent, at 17,365.25, reaching levels not seen since April. The Topix index gained 9.71 points, or 0.71 percent, to 1,377.32.
In Hong Kong, the Hang Seng index trimmed early declines to trade nearly flat at 23,617.41 as of 3:29 p.m. HK/SIN. Chinese mainland markets closed modestly higher, with the Shanghai composite up 3.83 points, or 0.12 percent, at 3,132.08, while the Shenzhen composite gained 7.53 points, or 0.36 percent, to 2,077.74.
In Australia, the ASX 200 index climbed 34.31 points, or 0.63 percent, to 5,442.80, with most sectors rising. The heavily-weighted financial sector closed up 0.74 percent, with the country's so-called Big Four banks gaining.
Shares of ANZ gained 0.67 percent, Commonwealth Bank of Australia was 0.75 percent higher, Westpac rose 1.08 percent and the National Australia Bank added 0.62 percent.
The dollar traded at 98.75 against a basket of currencies on Tuesday afternoon during Asian hours, off an earlier session high of 98.83, climbing from levels below 98.00 last week.
Analysts said rising U.S. Federal Reserve interest rate hike expectations supported the dollar during U.S. hours; dollar strength pushed other currency majors lower during Asian hours.
The yen retreated to the 104 handle, trading at 104.43 against the dollar as of 3:32 p.m. HK/SIN, compared with levels as high as 103.20 late last week.
Analysts at Singapore's DBS Bank said in a morning note the dollar/yen pair was looking to surpass the "ceiling of its 103.14-104.62 range established since 11 October." The analysts said if successful, the pair could move higher toward the 107 handle.
The relative weakness in the yen likely helped major Japanese exporters rise. Shares of Toyota rose 1.43 percent, Nissan was up 1.28 percent and Mazda Motor gained 2.93 percent. Panasonic shares retraced some of their 0.7 percent early gain to close up 0.19 percent.
Japanese gaming giant Nintendo saw some reprieve from share price declines, adding 2.98 percent to 24,685 yen a share following two consecutive sessions of losses as investors appeared somewhat unimpressed by the introduction of its new gaming console, Nintendo Switch, last week.
Japan's Kyushu Railway made its trading debut on the stock market, with Reuters reporting the shares were initially untraded after the market open on a glut of buy orders. Kyushu Railway eventually opened at 3,100 yen a share, which was 19.23 percent higher than the initial public offering (IPO) price of 2,600 yen, according to Reuters.
At market close, Kyushu Railway prices were at 2,990 yen a share.
The Australian dollar fell as low as $0.7586, after climbing to levels near $0.7640 in the Monday session. As of 3:36 p.m. HK/SIN, the pair traded at $0.7625.
The drop in the Australian dollar may have followed declines in commodity prices as the greenback strengthened. But the Aussie recovered, likely as traders were turning their attention toward inflation data due Wednesday.
Markets have little expectation that the Reserve Bank of Australia (RBA) will cut interest rates again any time soon, Lee Sue Ann, an analyst at UOB, said in a note Tuesday.
"We believe it would take a very weak and disappointing inflation number to push the RBA into easing yet further," she said. "Barring an extremely low third-quarter Australian consumer price index print, the currency pair is likely to stay supported around the 0.760-levels and may drift higher towards 0.770 in the near term."