Japan's Nikkei hit one-month intra-day high before ending up 0.8 per cent at 16,231.43, bringing its gains since Prime Minister Shinzo Abe's election victory on Sunday to 7.4 per cent.

Banks were the top gainers among the Tokyo Stock Exchange's 33 industry subindexes, adding 3.9 per cent.

Mitsubishi UFJ Financial Group jumped 5.3 per cent and Sumitomo Mitsui Financial Group rose 4.3 per cent.

Securities broker Nomura Holdings gained 3.5 per cent, while rival Daiwa Securities surged 3.4 per cent.

As the yen slipped to a three-week low of almost 105 to the dollar, exporters were also a bright spot.

Murata Manufacturing gained 5.7 per cent, while Toyota Motor Corp gained 3.4 per cent and Honda Motor Co rose 3.5 per cent.

But defensive shares fell with drugmakers falling 0.6 per cent.

Elsewhere, shares in Nintendo Co, had something of a rough landing, falling for the first time in five days on profit-taking after a Democratic US Senator asked the software developer behind Nintendo's high-flying “Pokemon GO” to clarify the mobile game's data privacy protection.

Nintendo was off 6.1 per cent after soaring 50 per cent over the past four days.

Many mid- and small-cap shares also came under pressure ahead of the IPO of internet firm Line on Friday.

The broader Topix gained 1.1 per cent to 1,300.26 but Topix small caps rose just 0.6 per cent. In contrast, the Topix core 30 of the biggest firms rose 1.6 per cent .

Trading was active with turnover reaching 2.89 trillion yen, about 35 percent above the average in the past month.

While sentiment was helped by a rally in US stocks to record highs following last week's strong jobs data, there were fresh bets that Abe would launch a new campaign to reboot an economy that is threatening to slip back into deflation.

On Tuesday, just a day after Abe ordered a new stimulus package, he met former US Federal Reserve Chairman Ben Bernanke, known as a proponent of monetary stimulus including "helicopter money” policies - printing money and handing it directly to consumers to stimulate the economy.

“Helicopter money is a powerful tool which will work if adopted,” said Masaaki Kanno, chief economist and managing director of economic research at JPMorgan.

While short-term speculators appeared to be buying, market players also cautioned that radical stimulus comes with side effects.

“I think people may see helicopter money as a kind of ultimate medical solution. If all else fails, you go for helicopter money,” said William De Vijlder, group chief economist at BNP Paribas.

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