Tokyo stocks opened higher on Tuesday, supported by rallies in US shares to fresh record levels due to euphoria over a US-China trade deal and upbeat economic data.

File photo: VCG

The benchmark Nikkei 225 index gained 0.49 percent or 118.38 points to 24,070.73 in early trade, while the broader Topix index was up 0.42 percent or 7.35 points at 1,744.22.

All three main US stock indexes finished at new record highs as investors cheered strong Chinese factory output data and the detente in the trading relationship between Washington and Beijing.

"The reduction in uncertainty both with respect to the US-China trade landscape as we head into 2020 and in the UK post last Thursday's election, has been enough to generate sizeable beginning-of-week gains for global equities," said Ray Attrill, strategist at National Australia Bank.

Conservative leader Boris Johnson romped to a massive parliamentary majority in Thursday's election, removing some of the uncertainty over Britain's future exit from the European Union.

Attrill also pointed to what he called an "eye-popping" report from the National Association of Home Builders showing a substantial improvement in US homebuilder confidence in December.

The dollar fetched 109.55 yen in early Asian trade, against 109.60 yen in New York.

"On the backdrop of US rallies, the Nikkei index may refresh the record level for this year," Toshiyuki Kanayama, senior market analyst at Monex, said in a commentary.

Among major shares in Tokyo, some automakers were higher, with Toyota advancing 0.41 percent to 7,821 yen, Honda trading up 0.90 percent at 3,235 yen and Mazda higher by 0.73 percent at 964 yen.

Elsewhere, Panasonic was up 0.38 percent at 1,040.5 yen, SoftBank Group climbed 0.94 percent at 4,498 yen, and market heavyweight Fast Retailing, the Uniqlo casual wear operator, was up 0.94 percent at 67,620 yen.

On Wall Street, the Dow closed up 0.4 percent at 28,235.89.