MSCI’s broadest index of Asia-Pacific shares outside Japan was up by 0.05 per cent on the back of a positive lead from Wall Street overnight.
Hong Kong’s Hang Seng Index opened 0.3 per cent higher at 28,441.95.
Australia’s S&P/ASX200 edged up 0.22 per cent to 7,044.3 as the Reserve Bank of Australia is expected to keep the official cash rate on hold at 0.1 per cent for May as it waits for further signs of the domestic economy’s rebound from the pandemic led downturn.
A statement following the decision at 0430 GMT will be monitored for indications whether the unprecedented quantitative easing programme there could start to be tapered.
On Monday, Federal Reserve chairman Jerome Powell said the U.S. economy was doing better but was “not out of the woods yet” as the central bank prepared to release a study on the disparate effects of the pandemic on the country’s different demographics.
“The economy is reopening, bringing stronger economic activity and job creation,” Powell said in remarks prepared for delivery at a conference of the National Community Reinvestment Coalition.
“That is the high-level perspective – let’s call it the 30,000-foot view – and from that vantage point, we see improvement. But we should also take a look at what is happening at street level.”
Japan and mainland China’s markets remained closed on Tuesday for holidays dampening trading volumes across the region.
The brighter tone in Asian markets came after a stronger session on Wall Street.
The Dow Jones Industrial Average rose 0.7 per cent to end at 34,113.23 points, while the S&P 500 gained 0.27 per cent to 4,192.66 with most of the gains concentrated in industrial and commodity shares.
The Nasdaq Composite dropped 0.48 per cent, to 13,895.12 as technology stocks lagged stocks investors saw as beneficiaries of a pandemic recovery.
Energy stocks also gained on the back of higher oil prices.
In the Asian session, Brent crude was trading up 0.15 per cent at $67.66 while U.S. light crude was 0.12 per cent higher at $64.56.
“Crude oil gained (in U.S. trading) as easing restrictions in the U.S. and Europe raise hope of stronger demand. The European Union is planning to ease restrictions on vaccinated travellers over the summer,” ANZ economists said in a note to clients.
“This comes as several countries emerge from lockdowns amid a fall in new infections of the coronavirus.”
U.S. Treasury yields fell on Monday after data showed manufacturing activity growth slowed in April amid supply chain challenges and rising demand fueled by the COVID-19 vaccine rollout and fiscal stimulus.
Focus is now expected to turn to services data due on Wednesday and non-farm payrolls numbers on Friday.
The benchmark 10-year yield, which hit a session low of 1.578 per cent, was last down 3 basis points at 1.6011 per cent, holding well below a 14-month high of 1.776 per cent reached on March 30.
