Asian shares rose Wednesday as strong U.S. earnings reports brightened investor mood, while the euro hit a one-month high against the dollar as Spain dodged a bullet when Moody's Investor Service kept Madrid's investment grade rating.
U.S. stocks rose on Tuesday as big-name companies reported stronger-than-expected earnings, with Johnson & Johnson and UnitedHealth Group both increasing their full-year profit forecasts while Goldman Sachs (GS.N) raised its dividend, Reuters reported.
Risk tolerance grew on talk of European Union aid for Spain, driving down safe-haven U.S. Treasury prices and weighing on the dollar index Tuesday.
The index, measured against a basket of six key currencies, fell to a 1-1/2 week low early on Wednesday. A weaker dollar in turn helped underpin dollar-based commodities.
The MSCI index of Asia-Pacific shares outside Japan was up 0.5 percent. Australian shares rose 0.9 percent to their highest since July 2011, with the mining sector up on higher metals prices. South Korean shares added 0.7 percent. Japan's Nikkei average opened 0.9 percent higher.
"The Kospi will attempt a second day of gains as the macro environment has improved. However, the rise will be capped by concerns about third quarter earnings," Won Sang-pil, an analyst at Tongyang Securities told Reuters, referring to Korean stocks.
The euro jumped 0.5 percent to its highest since September 17 of $1.3125 after rating agency Moody's Investors Service on Tuesday affirmed its investment grade sovereign rating on Spain, easing fears about Madrid's ability to manage its huge public debt.
Moody's assigned a negative outlook but kept its Baa3 rating, citing the willingness of the European Central Bank to undertake outright purchases of Spanish government bonds and the Spanish government's continued commitment to implement fiscal and structural reform measures.
The dollar eased 0.1 percent against the yen at 78.80, retreating from Tuesday's one-month high of 78.97 yen.
U.S. crude futures gained 0.4 percent to $92.41 a barrel.
Spot gold inched up 0.1 percent to $1,749.29 an ounce.
Asian credit markets firmed slightly, with the spread on the iTraxx Asia ex-Japan investment-grade index narrowing by 1 basis point.