Japan's Nikkei surged on Tuesday, rebounding from a three-week low, as a weaker yen boosted demand for shares of exporters such as automakers and machinery makers.
The Nikkei share average jumped 2.1 percent to 20,754.28 points by midmorning, after posting its biggest one-day loss since early January on Friday. Japanese markets were closed on Monday for a holiday.
The dollar has gained against the yen over the last week, pushing up earnings prospects for machinery, auto and electronics products makers. It was steady at 110.37 yen on Tuesday.
Advantest Corp jumped 4 percent, Honda Motor Co rose 1.7 percent, Mazda Motor surged 3.5 percent and Panasonic Corp added 2.6 percent and Hitachi Ltd advanced 1.6 percent.
"Short-term traders such as hedge funds are seen selling the yen and buying stocks," said Yutaka Miura, a senior technical analyst at Mizuho Securities.
Most exporters expect the dollar to trade between 105-110 yen for the fiscal year through March. A weaker yen boosts Japanese exporters' profits made abroad when repatriated.
Isuzu Motors soared 7.2 percent after its operating profit for April-December jumped 17 percent to 144.13 billion yen thanks to strong sales of pickup trucks in Asia.
But Toshiba Corp tumbled 6.8 percent after the Nikkei business daily said that the company is set to slash its operating profit forecast for the year through March to between 20 billion yen and 30 billion yen, with growing costs in sectors like energy dragging down earnings from core operations.
Toshiba said that the Nikkei report was not based on something the company announced, but the figure is close to what the company estimates.
Rental apartment operator Leopalace21 Corp was untraded with a glut of sell orders, pointing to a fall to a daily limit low of 335 yen after the company posted an extraordinary loss of 43 billion yen related to repairs and construction defects.
The company said on Friday that it is moving 14,443 residents out of their homes to repair defects found in more than 1,300 buildings nationwide. Leopalace dived 19 percent on Friday.
The broader Topix gained 2 percent to 1,569.59.