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Japan, China stocks lead Asia higher as Ukraine, Gaza worries ebb

Asian equity markets rose on Tuesday as geopolitical concerns in eastern Ukraine and the Gaza strip eased.

A breakthrough in developments at the Malaysia Airlines crash site helped to stabilize sentiment. Rebel leaders handed over two black boxes to Malaysian experts in Donetsk who confirmed they were in good condition. Meanwhile, Russia's envoy to Malaysia said in a news conference that the rebels do not have Buk missile systems and called for the investigation to be conducted by the international community.

"It seems the battle between geopolitical risk and US earnings is in play at the moment and we'll continue to see a tug of war in the near term. For now though, pressure seems to have eased a touch and this is giving risk assets room to move," said Stan Shamu, market strategist at IG.

Read MoreGlobal turmoil may punish complacency: El-Erian

Hopes for a ceasefire in Gaza were also in focus after U.S. Secretary of State John Kerry and United Nations chief Ban Ki Moon arrived in Cairo for talks aimed at stopping the bloodshed.

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 0.8% higher

Following Monday's public holiday, Japanese shares played catch up with the region. The benchmark Nikkei moved off Friday's one-week low as the yen weakened against the greenback.

Steelmaker JFE Holdings rallied over 2 percent after the Nikkei newspaper reported that the firm plans to double production capacity at its Myanmar steel site in 2015.

Panasonic jumped 1.8 percent following news on Monday that it reached a basic agreement to sell its cellphone base station business to Finland's Nokia.

Read MoreThe top market risk this summer is...

Shanghai up 1%

China's benchmark Shanghai Composite rose to its highest level since June 16, shrugging off worries about a raft of initial public offerings, thanks to gains in automakers.

Read MoreChina's debt to GDP ratio breaks 250% of GDP

Changan Auto ended 3 percent higher, FAW Xiali soared 10 percent and SAIC Motor climbed 1.7 percent following Monday's policy announcement about promoting electric and plug-in hybrid cars.

Aluminum Corp. of China closed up over 5 percent after aluminum prices hit a 16-month peak.

Meanwhile, Hong Kong shares rose to their highest level in more than seven months.

ASX up 0.1%

Australia's benchmark S&P ASX 200 index closed at fresh six-year highs after a quiet session. Stocks were little changed after central bank governor Glenn Stevens failed to make any mention of domestic monetary policy or the Australian dollar in a speech.

Read MoreAustralia stocks: Good times to roll on

Gold miners were mixed as bullion prices climbed above $1,300 an ounce. Alacer Gold rose over 1 percent while Evolution Mining fell over 1 percent.

Kospi up 0.5%

South Korean shares ended at fresh eight-month highs after the country's finance minister promised on Tuesday to use more expansionary and aggressive monetary policy to boost growth.

Chip-maker SK Hynix rose 1 percent after saying on Monday that Japanese rival Toshiba was seeking $1 billion in damages in a lawsuit.

Emerging markets mixed

Indonesia's benchmark Jakarta Composite tanked nearly 1 percent ahead of official results from the county's presidential election, widely expected sometime on Tuesday. Reuters reported that Indonesian former general Prabowo Subianto has withdrawn his presidential candidacy, denouncing the election process as undemocratic.

Meanwhile, Indian shares tacked on 1.2 percent and completed a sixth straight session of gains.

Contact Asia

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