Tokyo stocks surged almost five percent to a record high Monday and the yen sank on bets that the new leader of Japan's ruling party will embark on a new era of loose monetary policy to kickstart the country's economy.

The gains, however, came on a mixed day for the rest of Asia, while Paris tumbled more than two percent on news that France's newly appointed prime minister had stepped down, compounding a political crisis in the country.

News of the victory for Sanae Takaichi -- who is expected to become prime minister this month -- fanned a fresh wave of optimism on Japanese trading floors as she has previously backed aggressive monetary easing and expanded government spending.

Expectations the Federal Reserve will cut interest rates this month continue to support risk assets, with the

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