Asian stock markets are mostly higher with modest gains on Tuesday following the record closing highs overnight on Wall Street amid growing optimism about a U.S.-China trade deal. The Financial Times reported that the U.S. is considering dropping tariffs on $112 billion of Chinese imports. The Japanese market, which resumed trading after a holiday on Monday, is notably higher.
The Australian market pared initial gains and is trading flat as investors turned cautious ahead of the Reserve Bank of Australia's monetary policy decision due later in the day. The RBA is widely expected to leave its benchmark lending rate unchanged at the record low of 0.75 percent.
The benchmark S&P/ASX 200 Index is down 1.60 points or 0.02 percent to 6,685.30, after touching a high of 6,725.90 earlier. The broader All Ordinaries Index is up 1.60 points or 0.02 percent to 6,801.40. Australian stocks closed higher on Monday.
Among the major miners, BHP Billiton and Rio Tinto are advancing more than 1 percent, while Fortescue Metals is rising 2 percent.
Oil stocks are also mostly higher after crude oil prices rose overnight. Woodside Petroleum is adding almost 1 percent and Oil Search is rising 0.3 percent, while Santos is down 0.2 percent.
In the banking space, ANZ Banking, Commonwealth Bank and National Australia Bank are higher in a range of 0.3 percent to 0.7 percent.
Westpac's shares, coming out of a trading halt, are losing more than 4 percent after the bank said it has completed a A$2 billion share placement to meet regulatory capital requirements. On Monday, the lender reported a 15 percent decrease in full-year cash profit and cut its dividend.
Among gold miners, Evolution Mining is losing almost 3 percent and Newcrest Mining is lower by more than 1 percent after safe-haven gold prices edged lower.
On the economic front, the latest survey from the Australian Industry Group revealed that the services sector in Australia continued to expand in October, and at a faster rate, with a Performances of Services Index score of 54.2. That's up from 51.5 in September and it moves further above the boom-or-bust line of 50 that separates expansion from contraction.
In the currency market, the Australian dollar is lower against the U.S. dollar on Tuesday. The local currency was quoted at $0.6879, down from $0.6905 on Monday.
The Japanese market, which resumed trading after a holiday on Monday, is notably higher following the record closing highs on Wall Street amid growing optimism about a U.S.-China trade deal. The major exporters are rising on a weaker yen.
The benchmark Nikkei 225 Index is adding 318.05 points or 1.39 percent to 23,168.82, after touching a high of 23,215.48 in early trades.
The major exporters are higher as the safe-haven yen weakened. Mitsubishi Electric is gaining almost 2 percent, Panasonic is rising more than 1 percent, Canon is advancing 1 percent and Sony is adding 0.6 percent.
Market heavyweight SoftBank Group is rising more than 2 percent, while Fast Retailing is adding almost 1 percent.
Among auto stocks, Toyota Motor is up 0.3 percent and Honda Motor is adding almost 2 percent. In the tech space, Advantest is gaining almost 4 percent and Tokyo Electron is rising more than 2 percent.
In the oil sector, Japan Petroleum is gaining more than 4 percent and Inpex is higher by more than 3 percent after crude oil prices extended gains overnight.
Among the major gainers, Z Holdings is gaining more than 11 percent, Yamaha Corp. is rising more than 10 percent and Ricoh Co is higher by almost 7 percent.
On the flip side, Mitsui E&S Holdings is falling more than 26 percent, Konica Minolta is losing almost 10 percent and Konami Holdings is lower by almost 7 percent.
In economic news, the Bank of Japan said that the monetary base in Japan was up 3.1 percent on year in October, coming in at 517.100 trillion yen. That's up from the 3.0 percent increase in September.
In the currency market, the U.S. dollar is trading in the upper 108 yen-range on Tuesday.
Elsewhere in Asia, South Korea, Singapore, Indonesia, Hong Kong and Taiwan are all modestly higher, while Shanghai, New Zealand and Malaysia are lower.
On Wall Street, stocks closed at new record closing highs on Monday as traders remain hopeful about a U.S.-China trade agreement, with Commerce Secretary Wilbur Ross expressing optimism phase one of a trade deal could be signed this month. News on the merger-and-acquisition front also generated some positive sentiment, with shares of Wright Medical Group soaring after the medical device maker agreed to be acquired by larger rival Stryker.
The Dow climbed 114.75 points or 0.4 percent to 27,462.11, the Nasdaq advanced 46.80 points or 0.6 percent to 8,433.20 and the S&P 500 rose 11.36 points or 0.4 percent to 3,078.27.
The major European markets also showed strong moves to the upside on Monday. While the German DAX Index surged up by 1.4 percent, the French CAC 40 Index jumped by 1.1 and the U.K.'s FTSE 100 Index advanced by 0.9 percent.
Crude oil prices saw some further upside on Monday amid renewed optimism about the outlook for global demand. WTI crude for December delivery rose $0.34 or 0.6 percent to $56.54 a barrel.