Nikkei electronic board
A man walks past an electronic board displaying the Nikkei average outside a brokerage in Tokyo, April 1, 2016. REUTERS/THOMAS PETER

This story was updated at 11:30 pm EDT.

Asian stocks rose on Tuesday, led by a rebound in Japanese stocks, while commodities such as crude oil stood tall thanks to a sagging dollar.

MSCI's broadest index of Asia-Pacific shares outside Japan rose 0.4 percent.

Japan's Nikkei, which fell to two-months lows on Friday, pared earlier losses and gained more than 1 percent on bargain hunting in recently beaten down shares like banking stocks.

Still, the bullish yen remained a concern for Japanese equities.

"Investors are frustrated about the lack of effective measures against the strong yen," said Hikaru Sato, senior technical analyst at Daiwa Securities in Tokyo.

"Confidence in Japanese stocks has waned since the end of last year and it still hasn't recovered."

Elsewhere, Australian shares climbed 0.6 percent, supported by firm commodities. South Korea's Kospi added 0.2 percent. Volatile Shanghai stocks bucked the trend and lost 0.4 percent.

Despite the gains made on Tuesday, wariness over the U.S. earnings season was expected to cap risk assets this week. Metals company Alcoa Inc. on Monday reported a lower quarterly profit, with results hurt by factors like low commodity prices.

"Alcoa kicked off the earnings season in weak fashion and the U.S. banks are reporting over the next few days, which markets typically take as a bellwether of the rest of the season," wrote Sam Tuck, senior FX strategist at ANZ.

"Markets are expecting a tough reporting season, which will ensure they remain sceptical on the improvements in the global backdrop."

U.S. crude oil CLc1 fetched $40.27 a barrel after rising to a three-week high of $40.75 on Monday. Brent crude, which popped above $43 a barrel to a four-month peak overnight, traded at $42.76.

The dollar's recent depreciation has boosted commodity prices and crude was lifted by hopes that oil producers would agree to curb output at a meeting in Doha next Sunday.

A weaker greenback favors non-U.S. buyers by reducing the effective cost of commodities priced in dollars.

Spot gold XAU= touched a three-week high of $1,259.66 an ounce. Spot silver was down 0.7 percent after surging 3.9 percent overnight and platinum edged back 0.5 percent following Monday's 2 percent rise.

Iron ore rose nearly 5 percent overnight to $55.90 a tonne, its highest in three weeks.

The dollar was steady at 107.93 yen, not too far from a 17-month low of 107.63 struck on Monday. The dollar index stood at 93.966, hovering near an eight-month trough of 93.748 plumbed overnight. The euro was flat at $1.1409.

The U.S. currency has been on the back foot since Federal Reserve Chair Janet Yellen last month doused expectations for hikes in U.S. interest rates anytime soon.

Commodity-linked currencies stood firm as commodity prices rose. The Australian dollar added 0.3 percent to $0.7619, on track for its third straight day of gains. The Canadian dollar was steady at C$1.2907 per dollar following a rise of 0.7 percent on Monday.

While risk assets made modest gains in the region, safe-haven government bonds, supported by very loose monetary policies, also continued to attract demand.

The 30-year Japanese government bond (JGB) yield slipped to a new record low of 0.390 percent as investors continued to move down the yield curve for better returns.