Japanese stocks rose on Monday, as the dollar's steady performance against the yen fuelled buying in stock futures, while Nomura Real Estate dived after saying a stake purchase in the company by Japan Post was no longer being considered.
The Nikkei was up 0.6 per cent at 20,063.42 in mid-morning trade. The dollar was up 0.2 per cent at 111.01 yen, boosting investor demand for stock futures, traders said.
“Investors are buying futures today ... it's more like today's trading is futures-led than trade-led by individual stocks,” said Yutaka Miura, a senior technical analyst at Mizuho Securities.
The dollar was up 0.1 per cent at 110.955 yen, which lifted US futures, which helped underpin risk appetite in Asian trade.
“People also expect that Wall Street will fare better later in the day,” Mizuho's Miura said.
The Nikkei is trading at more than one-week highs above the psychologically important 20,000-line, after the market digested the Bank of Japan's decision to keep policy unchanged on Friday.
After the US Federal Reserve's rate hike and the BOJ's policy meeting, traders said the market was left with no major catalysts this week but will continue to stay focused on upcoming US economic indicators.
Monday's notable gainers included domestic-demand sensitive stocks.
Construction companies Taisei Corp and Obayashi Corp both rose 1.6 per cent, while Kajima Corp soared 2.1 per cent.
Underperforming the market was Nomura Real Estate Holdings , which sank 13 per cent after it confirmed weekend media reports that Japan Post Holdings would likely scrap the talks to buy a stake in Nomura as the two companies had struggled to agree on the terms.
The potential deal was first reported in mid-May, pushing Nomura's shares up by 20 per cent.
Major exporters were mixed, with Toyota Motor Corp flat, Nissan Motor Co shedding 0.7 per cent and Hitachi Ltd gaining 0.7 per cent.
Takata Corp was untraded with a glut of sell orders, indicating the shares will tumble 17 per cent to a daily limit low of 404 yen after the company released a statement on Friday saying that no decision of any kind has been made about bankruptcy procedures.
Trading in Takata was suspended throughout Friday because the company offered no official statement after sources said it was preparing to file for bankruptcy as early as next week.
The broader Topix rose 0.6 per cent to 1,605.73 and the JPX-Nikkei Index 400 advanced 0.6 per cent to 14,286.43.