Japan's Nikkei share average scaled a two-year peak on Friday, on track for a weekly gain, buoyed by the impact of a weaker currency as well as record highs on Wall Street.
The Nikkei was up 0.3 per cent at the end of morning trade at 20,679.18 points, after probing its highest levels since October 2015.
On Thursday, the S&P 500 posted its sixth straight record high close on Thursday, its longest run since 1997, as investors cheered increased prospects for a tax overhaul with Congress moving closer to agreement on a budget resolution.
A weaker currency also gave Japanese shares a lift. The dollar edged up 0.1 per cent on Friday to 112.86, up 0.3 per cent for the week.
“The Nikkei is getting a lift from US stocks gains, and hopes that tax reform will be implemented, though it remains to be seen whether the U.S. momentum can continue,” said Norihiro Fujito, a senior investment strategist at Mitsubishi UFJ Morgan Stanley Securities.
“On the domestic side, there is Japan's election this month, and there is not yet a consensus on a likely outcome and the market impact,” he said.
Snap election
Prime Minister Shinzo Abe had last week called a snap election for October 22, in a bid to maintain his conservative Liberal Democratic Party-led coalition's majority in the lower house. But support is growing for a new party formed by Tokyo's popular governor, Yuriko Koike.
Investors were also wary ahead of key US employment data later in the global session, as well as continuing tensions surrounding North Korea.
A week ago, Japan's defense minister expressed concerns about a possible provocation from North Korea on October 10, when Japan begins campaigns for its upcoming lower house election - a date that will coincide with one of Pyongyang's main anniversaries.
Shares of Japan's MS&AD Insurance Group Holdings were up 1.5 per cent at midday, after it said on Friday it had agreed with Swiss Re AG to invest 800 million pounds ($1.05 billion) to take a stake of up to 15 per cent in UK-based ReAssure Jersey One Ltd.
The insurance subindex was up 1.4 per cent.
Shares of Nomura Co rose as much as 5.3 per cent before ending the morning up 1.4 per cent. The brokerage had on Thursday posted a net profit of 2.68 billion yen ($23.75 million) in the half-year through August 31, a rise of 19.7 per cent.
Toshiba Corp shares rose 1.4 per cent.
US private equity firm Bain Capital LP had on Thursday said it aims to list Toshiba's chip unit on the Tokyo Stock Exchange within three years, to cash in its investment after leading an $18 billion acquisition of the business.
Toshiba aims to complete the sale by the end of its fiscal year in March.
The broader Topix gained 0.2 per cent to 1,686.32, while the JPX-Nikkei Index 400 also rose 0.2 per cent to 14,885.03.