Asian shares gain as tensions drop

Hong Kong - Asian shares closed mostly higher on Tuesday, tracking rallies on Wall Street and in Europe as easing geopolitical tensions lifted investor confidence.

Tokyo gained 0.20% to 15 161.31, extending its recovery from sharp falls last week fuelled by Washington's announcement that it had authorised air strikes in Iraq.

Sydney jumped 1.34% to 5 530.30, Seoul rose 0.10% to 2 041.47 and Hong Kong gained 0.18% to 24 689.41.

But Shanghai slipped 0.14% to 2 221.59 as investors locked in profits following recent gains.

Bangkok was closed for a public holiday.

US President Barack Obama, who reluctantly ordered the air strikes last week to beat back rampaging Islamic State extremists, welcomed the nomination of a new Iraqi prime minister Monday to replace controversial leader Nuri al-Maliki.

Obama voiced hope that a new Iraqi leadership would forge an "inclusive government" and begin to ease the sectarian divisions that have fuelled the crisis.

Investors were also tracking the crisis in conflict-torn Ukraine as concerns persisted over a possible Russian military incursion.

Russia said Monday it would send a humanitarian convoy to the east of the country, despite strong warnings from the West that Moscow should not act alone in case the operation is a cover for sending in troops.

Russia insists its military would not be involved in the convoy, but Kiev said Moscow could only play a role as part of a broader Red Cross mission.

US stocks finished higher on Monday as subsiding geopolitical tensions boosted market confidence.

The Dow Jones Industrial Average rose 0.10% to 16 569.98, while the broad-based S&P 500 gained 0.28% to 1 936.92.

On currency markets, the dollar rallied against the yen and euro after the unit fell in the wake of last week's announcement of US air strikes.

The dollar was at ¥102.29 in afternoon trade compared with ¥102.21 in New York late on Monday.

The euro was quoted at $1.3375 and ¥136.81, from $1.3383 and ¥136.79 in New York.

On oil markets, US benchmark West Texas Intermediate for September delivery eased 33 cents to $97.75 while Brent crude for September was down 38c to $104.30 in afternoon trade.

Gold traded at $1 312.30 an ounce at 12:45 compared to $1 307.68 an ounce on Monday.

In other markets:

- Taipei shed 0.11% to 9 163.12.

TSMC rose 0.83% to Tw$121.5 while HTC fell 0.79% to Tw$125.5.

- Manila closed up 0.39% at 6 983.49.

Top-traded Philippine Long Distance Telephone Co gained 1.17% to 3 116 pesos while Ayala Land rose 2.09% to 31.70 pesos.

- Wellington rose 0.12% to 5 055.81.

Chorus was up 0.29% at NZ$1.735 and Fletcher Building gained 1.02% to NZ$8.90.

- Singapore eased 0.09% to 3 303.39.

DBS Bank rose 0.45% to Sg$18.04 while agribusiness company Wilmar International was down 0.93% to Sg$3.19.

- Kuala Lumpur added 1.07 points to 1 850.39.

Malayan Banking gained 0.10% to 9.94 ringgit, Public Bank rose 0.11% to 19.00 while Malaysian Airline System declined 1.92% to 0.26 ringgit.

- Jakarta advanced 0.37% to 5 132.395.

State miner Aneka Tambang rose 0.81% to 1 250 rupiah, while palm oil producer Astra Agro Lestari slipped 0.94% to 26 250 rupiah.

- Mumbai climbed 1.42% to 25 880.77.

Eicher Motors rose 7.94% to 9 280.85 rupees while Ramco Cements jumped 7.77% to 294.60 rupees.