Tokyo stocks jumped 1.20 percent on Friday morning with export shares rising on a weaker yen, as Japan's new government unveiled a $226.5 billion stimulus package to stoke the economy.
The benchmark Nikkei 225 index gained 127.81 points to 10,780.45, while the broader Topix index of all first-section shares rose 0.93 percent, or 8.28 points, to 897.30.
The dollar shot as high as 89.34 yen in Friday forex trade, its strongest since June 2010, on hopes of more Bank of Japan easing and after official data showed Japan's trade picture grew worse with the November current account falling into a 222.4 billion yen ($2.5 billion) deficit, worse than expected.
"The stock market cares little about the current account per se, but the weaker yen is fuelling reflexive bullishness," said Toshihiko Matsuno, senior strategist at SMBC Friend Securities.
"Along with the expected buying in exporters, investors are also targeting commodity-tied shares on the theory that they have been underserved over the current broad-market rally," he told Dow Jones Newswires.
Prime Minister Shinzo Abe, a hawk who came to power last month on a pledge to reverse Japan's fading fortunes and get tough on diplomacy in the face of territorial tensions with China, outlined details of the budget at a Tokyo press briefing.
Abe said the package was designed to stir Japan's lumbering economy and create 600,000 new jobs as well as dragging the country out of chronic deflation that has haunted the world's third-largest economy for years.
The new leader repeated a call for Tokyo and the Bank of Japan (BoJ) to "join hands" on driving growth, comments that have stoked tension between the new leader and BoJ chief Masaaki Shirakawa over perceived threats to the central bank's independence and policy decisions.
In Tokyo stock trading, Honda rose 0.90 percent to 3,360 yen and Nikon jumped 2.73 percent to 2,705 yen.
Sharp shares jumped 9.20 percent to 320 yen after a report in Japan's Mainichi newspaper said the money-losing electronics maker had returned to operating profit in the three months to December.
The dollar bought 88.93 yen in Tokyo midday trade against 88.64 yen in New York Thursday afternoon. Earlier Friday the greenback briefly rose to 89.34 yen, the highest level since June 2010.
The euro fetched 117.97 yen after rising past 118.00 yen for the first time since May 2011.