Asian shares hit a 16-month high on Wednesday, led by surging Chinese equities on hopes for stable growth, but concerns over whether U.S. lawmakers can break a budget impasse before year-end to avert a possible economic slump kept optimism in check.
The FTSE CNBC Asia 100 index rose 0.6 percent.
Japan's Nikkei average rose to a seven-month closing high on Wednesday, lifted by sharp gains in Chinese equities after comments by Communist Party chief raised hopes for an economic recovery in the world's second-largest economy.
The Nikkei ended 0.4 percent higher at 9,468.84 points in a choppy session, after trading in range of 9,376.97 to 9,515.86.
Gains in index heavyweight Fast Retailing, which reported strong November same-store sales at its Uniqlo casual clothing chain in Japan, rallied 3 percent.
Construction machinery makers Komatsu and Hitachi Construction Machinery , which have significant exposure in China, gained 0.7 and 1.8 percent, respectively.
Exporters headed higher included Nissan Motor, Olympus and Kyocera, gaining between 0.4 and 1.9 percent.
Sharp climbed 4 percent after the struggling TV maker said U.S. chipmaker Qualcomm will invest as much as $120 million in the Japanese firm, a cash injection likely to make it Sharp's biggest shareholder.
Onshore China shares posted their best day in three months on Wednesday, as investors cheered comments from new Communist Party chief Xi Jinping that set his economic agenda ahead of the party's central economic planning meeting this month.
The CSI300 Index of the top Shanghai and Shenzhen listings soared 3.6 percent. The Shanghai Composite Index jumped 2.9 percent to 2,031.9, returning above the 2,000-point mark for the first time in more than a week.
Wednesday's gains helped China outperform other Asian bourses after Xi, in comments ahead of the central economic planning meeting later this month, listed tax reform, urbanization and allowing the market to play a bigger role in setting resource prices as among his priorities.
Hong Kong shares soared to their highest since August 2011, buoyed by a resurgent mainland Chinese market.
The Hang Seng Index ended up 2.2 percent at the day's high at 22,270.9, surpassing the previous intra-day high set on Monday. The China Enterprises Index jumped 2.9 percent.
Shares of Ping An Insurance jumped 4.9 percent in Hong Kong after HSBC said it sold its entire stake in China's second-largest insurer to a group linked to Thailand's richest man, Dhanin Chearavanont.
South Korean shares reached their highest closing level in nearly seven weeks on Wednesday, as market heavyweight Samsung Electronics touched a life-time high.
The Korea Composite Stock Price Index (KOSPI) finished up 0.6 percent at 1,947.04 points, its highest closing level since Oct. 18.
Samsung Electronics, which accounts for an about a fifth of the KOSPI market value, ended up 1.8 percent at a record-high 1,455,000 Korean won ($1,300) after the electronics giant promoted Jay Y. Lee, the son of its chairman and the anointed heir to vice chairman.
Financials rebounded after declines on Tuesday, with KB Financial up 1.1 percent and Woori Finance climbing 1.2percent.
Among smaller-cap stocks, shares of nTels surged by the daily limit after media reports that Japanese mobile operator SoftBank has invested 1.6 billion Korean won ($1.48 million) in the South Korean firm.
Australian shares rose 0.4 percent on Wednesday, winning back a good chunk of losses in the previous session, on expectations of more rate cuts after data showed the economy slowed in the third quarter
The benchmark S&P/ASX 200 index rose 16.8 points to at 4,520.4, according to the latest data, after falling 0.6 percent on Tuesday.
The Reserve Bank of Australia (RBA) cut interest rates to a record-matching low of 3 percent on Tuesday and investors suspect further easing will be needed to offset a profusion of headwinds, from a falling terms of trade to a high local dollar.
Top banks gained after the rate cut, with Commonwealth Bank advancing 1 percent.
Ten Network requested a trading halt ahead of an announcement in relation to a proposed capital raising.
Iron ore miner Sundance Resources plunged 12 percent to A$0.345 after it said its takeover by Hanlong Group would be delayed to the end of January because the Chinese company has not yet obtained the necessary funding.
New Zealand's benchmark NZX 50 index slipped 0.2 percent to 4,007.25 points.
In India, both the BSE Index and 50-share Nifty Index rose 0.5 percent.
Singapore's Strait Times Index gained 0.5 percent while Malaysia's KL Composite Index edged up 0.4 percent.