- Asian markets mixed after opening mostly higher on Tuesday
- Oil prices extended gains after adding 2 percent yesterday on news that Russia and Saudi Arabia had agreed to extend output cuts
- Euro strengthened before the release of Q1 GDP in Europe while the dollar continued its decline after weaker manufacturing activity in the U.S.
Asian markets were mostly higher in Tuesday trade, following the bounce in oil prices after the energy ministers of Russia and Saudi Arabia announced output cuts should be extended till March 2018 and as investors largely shrugged off U.S. political news on President Donald Trump.
U.S. West Texas Intermediate crude jumped more than 3 percent during the session yesterday following the news. Saudi Arabia and Russia are the world's top two oil producers.
"An extension of OPEC and Russia's oil production cuts for another nine months should put a floor under the oil price in the mid-$40 range as the market inches gradually towards balance," CMC Markets Chief Market Analyst Ric Spooner said in a note.
"While the threat of increased shale oil production may mean that the markets also struggles to achieve traction above the mid-$50 range ... the likely limitation to downside risk will serve as a confidence booster for the oil and gas producers."
The Nikkei 225 gained 0.25 percent or 49.97 points to close at 19,919.82. It traded at its highest levels since December 2015 earlier in the session. In an exclusive interview with CNBC, Japanese Prime Minister Shinzo Abe said that his country would continue pushing for a trans-Pacific trade deal, but he hoped the U.S. would rejoin the pact.
The Kospi finished the session 0.2 percent or 4.68 points higher at 2,295.33. Australia's S&P/ASX 200 rose 0.21 percent or 12.198 points to finish at 5,850.6, driven by gains in its industrials and materials sub-indexes.
Greater Chinese markets were mixed. The benchmark was down 0.16 percent. The closed higher by 0.62 percent and the Shenzhen composite surged 2.061 percent.
Meanwhile, Moody's downgraded the corporate rating of Singapore-listed Noble Group. The reasons for the downgrade was Noble's "weak operating cashflow and large debt maturities over the next twelve months," Moody's Senior Analyst Gloria Tsuen said in a note.
Noble Group shares gained 5.08 percent after slumping more than 20 percent last week.
Meanwhile, shares of airline Cathay Pacific sank 2.97 percent following reports the company would be cutting jobs as soon as this Friday. The company had earlier said it would be carrying out lay-offs due to competition in the market.
The airline told in a CNBC in a statement that "(t)here will be changes" that Cathay would address publicly "in due course." Cathay Pacific also added that its new management structure would be "leaner, faster and better."
Investors were also mulling the potential economic policy impact of a Washington Post report that Trump divulged highly classified information during his meeting with Russian officials last week. Officials told the Post that the information was sensitive and that its exposure endangered the relationship with an ally. The White House later denied the report.
The dollar index, which measures the dollar against a basket of foreign currencies, sank to trade at 98.768. It had traded at levels around the 99 handle last week.
The euro, which rose for a fourth consecutive session, strengthened to hit the $1.1011 mark — its highest level since the French election. The greenback gained against the yen for a second straight session, last trading at 113.37.
Meanwhile, the Aussie gained against the dollar to trade at $0.7426. The Aussie had touched a near four-month low last week due to weaker commodity prices. The New Zealand dollar also climbed against the dollar, last trading at $0.6884.
Prices of other commodities, including copper and aluminium, tracked the moves in oil, National Australia Bank Currency Strategist Rodrigo Catril said in note, adding that this "helped commodity-linked currencies outperform." He added that the Kiwi and Aussie had given up some gains as oil prices eased overnight.
The Aussie dollar was mostly unaffected by minutes of the Reserve Bank of Australia's (RBA) May meeting, which were released earlier in the morning. The RBA said it had concerns about the labor market but was certain that core inflation would improve by 2018, according to Reuters.
A deluge of data from Europe is expected during the European trading day, with the U.K. reporting CPI and PPI figures and Europe releasing Q1 GDP data at 4:30 pm and 5:00 pm HK/SIN respectively.
Over in the U.S., equities rose more than 0.4 percent across the board, with energy stocks contributing to the gains. The finished the session 0.48 percent higher while gains in tech and cybersecurity stocks caused the Nasdaq to rise 0.46 percent.