Sydney - Asian shares nudged higher on Tuesday, tracking rallies in the United States and Europe as investors seemed to put aside geopolitical concerns, at least for the moment.
MSCI's broadest index of Asia-Pacific shares outside Japan added 0.3 percent after jumping 1.5 percent on Monday. Japan's Topix rose 0.5 percent, while the Nikkei firmed 0.3 percent.
Singapore's Straits Times Index added 0.3 percent after the city-state reported annualised economic growth of 0.1 percent in the second quarter when analysts had expected a slight contraction. Strength in the financial sector helped offset sluggish manufacturing activity.
There was also promising news on global trade with the Philippines enjoying its fastest export growth in six months in June.
The better mood came even though Nato chief Anders Fogh Rasmussen warned of a “high probability” that Russia, using the guise of a humanitarian mission, could intervene militarily in Ukraine.
Ukraine has also said that, contrary to Russian reports of de-escalating, Russia has massed 45 000 troops on its border.
Investors also monitored Iraq, where the United States recently began air strikes targeting Islamic State fighters marching on the country's Kurdish capital.
None of this seemed to faze Wall Street, where the Dow rose 0.10 percent on Monday, while the S&P 500 gained 0.28 percent and the Nasdaq 0.70 percent.
Eight of the S&P's 10 primary sector indexes ended higher. Consumer staples shares posted the highest increases as the sector's index rose 0.8 percent, while energy and utilities shares dragged.
Shares of Kinder Morgan, the biggest US pipeline company, jumped 9 percent on news it would put all its publicly traded units under one roof in a $70 billion deal.
Yet there was enough of a safe-haven bid to keep Treasuries underpinned with yields on US 10-year paper at 2.433 percent, not far from last week's 14-month lows.
Major currencies were fenced in narrow ranges, with the US dollar index a shade firmer at 81.545 after drifting in a 82 tick-range on Monday, a far cry from Friday's 336 tick-range.
The dollar bought 102.28 yen, off Friday's low of 101.51, while the euro fetched 136.80 yen, still well off a trough of 135.73 plumbed on Friday.
Geopolitical concerns and sanctions against Russia will probably be reflected in a closely watched survey on German morale due later in the day, analysts at BNP Paribas said.
“We expect the headline expectations measure to fall to its lowest levels since the immediate aftermath of the EUR crisis in early 2013,” they wrote in a note to clients.
Such an outcome might keep the euro under pressure. The common currency last traded at $1.3371, still struggling after hitting a nine-month low of $1.3333 a few days ago.
In commodities, oil prices remained in a rut amid plentiful supply. Brent crude futures eased 19 cents to $104.49 a barrel, while US crude lost 28 cents to $97.80 per barrel.
Spot gold slipped a couple of dollars to $1,306.10 an ounce. - Reuters