Shino Abe's electoral victory over the weekend means that his ruling Liberal Democratic Party (LDP) will now have control of both chambers of parliament and a mandate to press ahead with difficult economic reforms.
"You have to be very skeptical," said Richard Jerram, chief economist at Bank of Singapore. "We've had every prime minister in the past 20 years, and there have been about 15, that have had a structural reform program. They've all promised and not delivered on that front."
(Read more: 'All systems go' after Abe's big election win?)
Meanwhile, volatility in the Japanese currency capped gains on the benchmark index. The greenback fell below the key 100-yen level, leading to a mixed performance in exporter stocks. Sumitomo Heavy Industries jumped 3 percent, but Mitsubishi Heavy Industries fell 4 percent.
Shanghai above 2,000
China's benchmark index entered positive territory after falling to its lowest levels in over a week. Banking stocks recovered some ground with mid-sized lenders China Merchants Bank and Shanghai Pudong Development Bank paring losses following an earlier 2 percent fall.
The sell-off comes after the People's Bank of China (PBOC) announced its biggest step yet towards financial reform on Friday. The central bank scrapped controls on lending rates, which now allows banks to set their own rates.
(Read more: Beijing loosens gripon rates - will it matter?)