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Singapore - Japanese stocks jumped more than 4% on Tuesday amid reports of progress in stabilising an earthquake-damaged nuclear plant and the yen edged up, putting traders on heightened alert for more central bank intervention.
Oil prices were steady, following a 1% rise in the previous session as widening unrest in the Middle East fed fears of supply disruptions.
Gold edged higher supported by a weak dollar and violence in the Middle East that boosted its safe-haven appeal.
Asian shares outside of Japan posted modest gains to recoup all of last week's losses, building on gains on Monday when Tokyo markets were closed for a holiday.
A firm close for US stocks after AT&T's move to buy Deutsche Telecom offered Asia support.
"Shares are bouncing with the Japan nuclear fear abating as the latest news reports point to steady progress on repairs at the nuclear plant site," said Kwak Joong-bo, a market analyst at Samsung Securities in Seoul.
However, European shares were seen opening lower in payback for three sessions of gains and S&P 500 futures were down 0.1%, pointing to a subdued Wall Street later.
Tokyo's Nikkei share average rose 4.4% to close near its intraday high.
Nikkei futures traded in Osaka rose a similar amount and Chicago-traded Nikkei futures gained 3.2%.
"Global value funds together with long-only investors are piling right in the middle of the index today, chasing big, liquid stocks attracted by cheap valuations," said Tetsuro Ii, CEO of Commons Asset Management.
The Nikkei is trading at a price-to-book ratio of 1.1, lower than 2.2 for the U.S. benchmark S&P 500, Thomson Reuters Starmine data shows.
The Nikkei is down 6.3% from its close on March 11, the day northeastern Japan was struck by a 9.0 magnitude earthquake and a 10-metre tsunami. The disaster has left at least 21 000 people dead or missing and crippled a nuclear power plant.
On Tuesday, technicians working inside an evacuation zone around the stricken plant 240 km (150 miles) north of Tokyo had managed to attach power cables to all six reactors and start a pump at one of them to cool overheating nuclear fuel rods.
But rising smoke and haze from two of the most threatening reactors suggested the battle to avert a disastrous meltdown was far from won, and mounting evidence of radiation in vegetables, water and milk stirred more concerns about the long-term impact.
MSCI's index of Asia-Pacific shares outside Japan rose 0.6 percent, bolstered by a rise in the Dow Jones industrial average and broader S&P 500 of 1.5%.
Asian shares outside Japan have now recovered all the ground they lost after the earthquake.
