- Asia markets were higher in afternoon trade, following the lead from Wall Street overnight amid strong economic data
- The euro traded lower against the dollar after reports that German Chancellor Angela Merkel said she'd prefer new elections over leading a minority government
- Energy prices remain in focus ahead of next week's OPEC meeting where oil producers will decide whether to extend output cuts beyond March 2018
Asia markets traded mostly higher on Tuesday, following gains in U.S. equities overnight amid strong economic data. This will be a short week for the U.S. stock market, which is set to be closed Thursday for the Thanksgiving holiday.
In Australia, the ASX 200 closed up 17.84 points, or 0.3 percent, at 5,963.52, with the heavily-weighted financial sector up 0.16 percent and the country's so-called Big Four banks finished mixed.
Japan's rose 154.72 points, or 0.7 percent, to 22,416.48 and the Topix index gained 11.48 points, or 0.65 percent, to 1,771.13. In South Korea, the Kospi closed up 3.03 points, or 0.12 percent, at 2,530.7.
Chinese mainland markets also ended higher. The rose 18.68 points, or 0.55 percent, to 3,411.08. The Shenzhen composite added 15.51 points, or 0.78 percent, to 1,987.45.
In Hong Kong, the added 1.22 percent at 3:12 p.m. HK/SIN.
Elsewhere, the dollar retreated against a basket of currencies to trade at 94.003 at 3:13 p.m. HK/SIN, coming off an earlier session high of 94.095.
The euro traded lower at $1.1744, compared to levels above $1.176 in the previous week. The common currency struggled after news emerged on Monday that German Chancellor Angela Merkel's efforts to form a coalition government had failed, thereby making the political outlook for Europe's largest economy uncertain.
Merkel later said on Monday that she would prefer new elections to leading a minority government.
One economist predicted that Germany could soon return to the polls. "It looks like Germany will be heading back to the electorate following the collapsed coalition talks this week, and little sign of any appetite for a resumption of the Grand Coalition," Rob Carnell, head of research for Asia at ING, wrote in a morning note.
Carnell added that the uncertainty of another election is "unhelpful for the region, though the [euro] seems to be weathering it quite well."
Among other currency majors, the Japanese yen traded at 112.52 to the dollar, strengthening from an earlier session high of 112.70.
The Australian dollar traded at $0.7543, falling from a session high of $0.7557. Earlier, the Reserve Bank of Australia released minutes from its November monetary policy meeting, during which the central bank had left the cash rate unchanged at 1.5 percent.
The minutes noted there was "considerable uncertainty around when and how quickly wage pressures might emerge" and how much of that would "add to inflationary pressure."
The central bank also "sees some upside risks to non-mining investment, as well as infrastructure spending," Wei Liang Chang, a currency strategist at Mizuho Bank, wrote in a note. He added, "All told, the broad tone reaffirms an unchanged monetary policy stance for now, without more durable signs of an uptick in wage inflation."
Oil is also a focus for investors ahead of next week's OPEC meeting in Vienna, where member states will decide if they would support an output cut deal beyond March next year.
Energy prices traded slightly higher on Tuesday afternoon Asia time, with U.S. crude up 0.07 percent at $56.46 a barrel. Global benchmark Brent also rose 0.16 percent to $62.32 at 3:15 p.m. HK/SIN. That followed a 0.8 percent decline on Monday.
Reuters reported that Iran's oil minister said Monday that a majority of OPEC members support extending output cuts beyond March next year, but the final decision will be made at next week's meeting.
— Reuters contributed to this report.