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Australia Outperforms Asian Stocks After RBA

Asian stocks closed mostly higher on Tuesday with Australia's benchmark S&P ASX 200 leading gains by 2.6 percent after the Reserve Bank of Australia (RBA) left the door open for future easing at its June policy meeting.

Sentiment across the region was much improved after a series of upbeat global manufacturing reports. Japan's benchmark Nikkei crossed 14,000 points to hit a new one-month high, the Shanghai Composite rose to a one-week high and South Korea's Kospi was steady at the 1,855 mark.

Symbol
Name
Price
 
Change
%Change
NIKKEI
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HSI
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ASX 200
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SHANGHAI
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KOSPI
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CNBC 100
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Global PMIs Support

Strong manufacturing reports in the U.S. and Europe lifted global equity markets overnight. Manufacturing activity in the U.S. edged higher in June to 50.9, according to the Institute for Supply Management, just above expectations for 50.5. A reading above 50 indicates expansion in the sector.

In the euro zone, the Purchasing Managers' Index (PMI) showed an uptick to 48.8, the highest reading since March 2012.

Sydney Up 2.6%

In a widely-expected move, the Australian central bank left its cash rate unchanged at 2.75 percent. The RBA maintained its easing bias and stated that the Australian dollar was still at high levels. In reaction, the currency lost nearly 1 percent to fall below the $0.92 handle against the greenback.

"Overall, it seems the RBA is very comfortable with the current policy setting. It feels the AUD will depreciate further over time, which would help foster a rebalancing of growth in the economy," said Stan Shamu, market strategist, IG.

(Read More: A Rudd Revival Bad News for Aussie Stocks?)

Resources were higher with Medusa Mining rallying 13 percent and Western Areas up 10 percent, tracking gains in copper prices.

Shares of the world's largest pallet supplier, Brambles, jumped 3 percent after the firm announced plans to spin off its information management business.

Nikkei Crosses 14,000

A weaker currency helped Japan's benchmark index rally nearly 2 percent to its highest levels in a month with dollar-yen trading at 99.55, off an earlier near one-month high of 99.86.

Exporters rose across the board with consumer electronics maker Sharp and automaker Mitsubishi Motors higher by over 9 percent each. Hitachi jumped 5.5 percent.

(Read More: Is Japan's Nikkei Getting Its Mojo Back?)

Shanghai Adds 0.5%

The mainland's benchmark Shanghai Composite reversed earlier losses to rise above the key 2,000 mark, a level which it hasn't seen in over a week.

Banking shares were hit after the People's Bank of China (PBOC) injected a lower-than-expected $5.9 billion into money markets at its open market operation.

Industrial Bank fell 2 percent, while Bank of Beijing and China Merchants Bank eased 1.5 percent each.

(Read More: China's Reforms Need No 'Wrist Cutting')

Kospi Flat

Gains in South Korea's benchmark index were capped due to a sell-off in the technology and auto sectors. The Kospi index has been on a steady uptrend since hitting a near one-year low at 1,770 last week.

Hyundai Motors fell 3.3 percent after being ordered to pay $14 million for air bag problems. Kia Motors meanwhile, fell 5 percent. Memory chip makers were lower with SK Hynix tumbling over 7 percent and LG Display down 2 percent.

STX Offshore & Shipbuilding added 7 percent after reports that the firm's offshore creditors are considering an addition $883 million injection to support the debt-ridden shipbuilder.

By CNBC.com's Nyshka Chandran. Follow her on Twitter @NyshkaCNBC