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Asia shares rise for second day ahead of Yellen testimony

Asian stocks were mostly higher on Tuesday as investors awaited Federal Reserve Chair Janet Yellen's two-day testimony later in the day.

"Yellen's semi-annual testimony on Capitol Hill is the most highly anticipated event risk this week. In the most ideal scenario traders are hoping for two outcomes - an increase in volatility that widens ranges for currencies and clarification on when the central bank will raise interest rates," said Kathy Lien, managing director of FX strategy for BK Asset Management.

Read MoreYellen could keep market rally going

Meanwhile, gains on Wall Street helped to boost sentiment in Asia. The Dow rose back above 17,000 on Monday after Citigroup posted a stronger-than-expected quarterly profit.

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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Nikkei 0.7% higher

Japanese stocks rose to a one-and-a-half-week high after snapping a five-day losing streak on Monday. As expected, the Bank of Japan left monetary policy unchanged following a two-day meeting but the central bank did cut its economic forecast for the current fiscal year to 1 percent from an earlier projection of 1.1 percent.

Panasonic ticked up 0.1 percent after the Nikkei newspaper reported that the firm will be unloading a staffing solutions business as it attempts to get rid of its noncore units.

Drugmaker Otsuka Holdings rallied 1.7 percent after submitting an application to the U.S. Food and Drug Administration for a schizophrenia and depression treatment drug.

Read MoreWhy shorting the yen could still work

Shanghai 0.2% higher

Mainland shares ended at a one-month high for the second straight session after data showed foreign direct investment rose for the 16th straight month in June.

Banks were modestly higher after new bank loans for June beat expectations. China Construction Bank rose nearly 1 percent while Industrial and Commercial Bank of China added 0.6 percent.

Read MoreChina GDP due – Here's what to expect

Airlines rose despite flagging lower earnings guidance due to the yuan's weakness. Air China rose 0.6 percent after saying first half net profit could drop as much as 65 percent while China Southern Airlines ended 0.4 percent higher after predicting an interim loss of over a billion yuan.

ASX flat

Australia's benchmark S&P ASX 200 reversed gains after briefly touching a seven-week high of 5,536 points. Markets were little changed following the release of the Reserve Bank of Australia's July policy minutes, where the central bank reiterated that rates would remain low for a while.

Australia New Zealand Banking fell 1 percent while Westpac eased 0.2 percent after a government-backed review said that the country's financial system performed "reasonably well" but warned of fiscal pressures ahead.

Read MoreWeak jobs - the next big risk for Australia?

Gold miners underperformed after prices of the yellow metal traded at four-week lows. Endeavor Mining and Evolution Mining lost over 6 percent each.

Kospi rises 1%

South Korean shares ended at their highest levels since July 2 after exports rose 2.5 percent in June, unchanged from the government's flash estimate.

Blue-chip stocks led the gains with Kia Motors and Hyundai Motor closing up over 3 percent each. Samsung Electronics ended 2.6 percent higher.

India 0.9% higher

India's NSE index ended five days of losses after data on Monday showed consumer inflation slowing to 7.3 percent in June.

Contact Asia

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