Most Asian equities extended gains into a second session on Tuesday following another U.S. rally, while investors kept an eye on the region's central banks. Markets in China remain closed until Wednesday for National Day holidays.
On Wall Street, the Nasdaq closed up 1.5 percent while the S&P 500 and Dow both spiked nearly 2 percent, fueled by expectations that the Federal Reserve will refrain from tightening monetary policy this year after last week's poor jobs report.
As widely expected, the Reserve Bank of Australia (RBA) left interest rates unchanged at their record low of 2 percent on Tuesday and said it would keep monetary policy accommodative. Several analysts are now betting on a rate cut before year-end, with the interbank market pricing in a 60 percent chance of a 25 basis point cut in December, according to spread better IG.
Meanwhile, the Bank of Japan begins a two-day policy meeting, with an outcome due Wednesday.
News that the U.S., Japan and 10 other Pacific Rim countries reached an agreement on the five-years-in-the-making Trans Pacific Partnership (TPP) also boosted sentiment. The trade deal, called one of the biggest of its kind in a generation, could yield global annual benefits of $295 billion by 2025, according to the Peterson Institute for International Economics. However, the deal still needs final approval from U.S. Congress.
"An accord among countries representing a large swath of the global economy sends a positive signal worldwide. The coordinated policy initiative represents a meaningful step towards much-needed structural reforms...increased market openness via trade policy reform on this scale can promote growth in a manner that compounds," HSBC said in a Tuesday report.