The Nikkei average rallied 1.76 percent to 47,672.67, after having fallen 2.6 percent in the previous session. The broader Topix index settled 1.58 percent higher at 3,183.64 as the country's first sale of government bonds since the collapse of the ruling coalition drew firm demand.

Semiconductor-related stocks rebounded, with SoftBank Group surging 5.1 percent and Advantest adding 2.2 percent.

Online retailer Mercari soared 14.2 percent after announcing it was pulling out of its on-demand employment service.

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