Japanese stocks gained for a third day, with the Nikkei 225 closing above 33,000 for the first time since July 1990, as investors expect a potential pause in rate hikes by the Federal Reserve this week.

The Topix rose 1.2% to close at 2,264.79, while the Nikkei advanced 1.8% to 33,018.65. Toyota Motor contributed the most to the Topix gain, increasing 5.1%, after executives sounded more confident in their ability to build and sell millions of electric vehicles. Battery-related stocks also climbed. Out of 2,156 stocks in the Topix, 1,194 rose and 858 fell, while 104 were unchanged.

"More market participants are expecting the FOMC to hold off on raising interest rates, which might result in more money flowing into the stock market." said Ayako Sera, market strategist at Sumitomo Mitsui Trust Bank. "While investors are cautious about the recent strength of Japanese equities, there is limited reason to sell at the moment."

Source : Bloomberg