Tokyo stocks closed higher Monday as data released before the morning bell showing core private-sector machinery orders increased in July lifted the market mood, while the yen's retreat against the U.S. dollar added to positive investor sentiment.

The 225-issue Nikkei Stock Average gained 270.95 points, or 1.41 percent, from Friday to close the day at 19,545.77.

The broader Topix index of all First Section issues on the Tokyo Stock Exchange, meanwhile, added 18.72 points, or 1.17 percent, to finish at 1,612.26.

The majority of industry categories closed in positive territory, with pharmaceutical, electric appliance and rubber product-linked issues comprising those that gained the most by the close of play.

Rising issues beat falling ones by 1,617 to 331 on the First Section, with 78 ending the day unchanged.

Brokers here said that government data showing that Japan's core private-sector machinery orders rose 8.0 percent in July from a month earlier to 853.3 billion yen (7.91 billion U.S. dollars), set a positive tone for the market.

The monthly machinery order data came in ahead of median analysts' expectations and being that the data set is a key advance indicator for corporate capital spending in Japan, the market mood was lifted on hopes for increased business spending in the months ahead.

The government here uses the data to predict the strength of business spending in a six to nine month period ahead, traders noted.

Market players also said that shares deemed to have been oversold were bought back on Monday as risk aversion related to tensions on the Korean Peninsular eased for the time being.

They noted that the yen's retreat against the U.S. dollar helped lift financial and exporter-linked issues that both have a bearing on the broader market.

On the main section on Monday, 1,498.64 million shares changed hands, dropping from Friday's volume of 1,860.42 million shares.

The turnover on the first trading day of the week totaled 1,989.9 billion yen (18.33 billion U.S. dollars).