TOKYO: Japanese stocks climbed to near their highest in a month on Tuesday with all sectors rising after Wall Street soared overnight.
Financial stocks outperformed in line with their U.S. counterparts' sharp gains.
The Nikkei rose 1.0 percent to 19,742.54 in midmorning trade, after hitting as high as 19,767.65, the highest level since Aug. 16.
The S&P 500 surged more than 1 percent to a record close on Monday as tropical storm Irma caused less damage in Florida than expected and North Korea held off from testing a missile or nuclear weapon over the weekend, which some had feared.
Insurers, securities brokers and banks , were among the top performers on the board, rising 3.3 percent, 1.6 percent and 1.5 percent, respectively.
The insurance sector took cues from the MSCI World's insurer index which soared 1.5 percent on Monday on expectations insured property losses from Hurricane Irma would be smaller than initially forecast.
"Japanese financial stocks joined the global financial rallies as there are many factors which benefit them today," said Nobuhiko Kuramochi, a strategist at Mizuho Securities.
Both the 10-year U.S. Treasuries yield and the 10-year cash JGB yield rose, increasing benefiting firms that invest in high-yielding products.
Dai-ichi Life Holdings jumped 3.3 percent, MS&AD Insurance surged 2.5 percent, Nomura Holdings gained 1.8 percent, Mizuho Financial Group added 1.1 percent while Sumitomo Mitsui Financial Group rose 1.6 percent.
Other winners included bellwether exporters, with Nintendo Co surging 2.5 percent, Toyota Motor Corp advancing 1.1 percent and Honda Motor Co gaining 1.8 percent.
Analysts said that although geopolitical fears for the Korean Peninsula eased for the time being, the market continued to monitor developments carefully.
The United Nations Security Council unanimously stepped up sanctions against North Korea on Monday over the country's sixth and most powerful nuclear test on Sept. 3, imposing a ban on its textile exports and capping imports of crude oil.
The measures were less severe than Washington's initial proposal while the U.S. Ambassador to the United Nations said the United States was not looking for war with North Korea and that Pyongyang had "not yet passed the point of no return."
The broader Topix added 0.9 percent to 1,626.08,
with all of its 33 subsectors in positive territory.