Tokyo stocks were 0.66 percent higher on Monday morning as a softer yen, positive Chinese manufacturing data and optimism over the US fiscal cliff budgetary impasse helped lift sentiment.
The Nikkei 225 index at the Tokyo Stock Exchange added 62.25 points to 9,508.26, while the broader Topix index of all first-section shares added 0.45 percent, or 3.50 points, to 784.96.
Also adding to the bullish sentiment, official data released Monday showed that capital spending by Japanese firms rose 2.2 percent in the July-September quarter from a year earlier.
Japan last week posted a surprise uptick in October factory production, a rare bright spot for the world's third-largest economy.
However, there are still widespread concerns about Japan's economy, which contracted in the latest quarter, nudging it towards recession and dousing hopes the nation had cemented a recovery after last year's quake-tsunami disaster.
On Monday, the Tokyo market was also boosted by data that showed China's manufacturing activity grew in November for the second month in a row, in a further sign of strength in the world's second-biggest economy after a marked slowdown.
"Stocks will trend a tad higher, but remain mostly in a tight range," Hiroichi Nishi, general manager of equities at SMBC Nikko Securities, told Dow Jones Newswires.
Wall Street put in a largely flat performance on Friday with the Dow Jones Industrial Average finishing 0.03 percent higher at 13,025.58.
Investors are confident that a deep divide between Democrats and Republicans will be overcome before a January 1 deadline for implementation of harsh tax hikes and spending cuts.
Monday will see the release of a string of US economic data including the key ISM November manufacturing index.
In currency trading, the 17-nation euro fetched $1.3037 and 107.40 yen in midday Asian trade, up from $1.2982 and 107.07 yen in New York late Friday.
The dollar, meanwhile, slipped slightly to 82.39 yen from 82.48 yen.