Asia follows Wall Street higher, risk appetite supports dollar

Asian shares rose on Wednesday, taking early cues from overnight Wall Street gains, while investors' sharper risk appetite lifted US debt yields and supported the dollar.

MSCI's broadest index of Asia-Pacific shares outside Japan gained 0.4%. Australian shares surged 1.3%.

Large tech and energy sector gains drove US stocks higher on Tuesday, with an index of 100 major Nasdaq companies finishing at a record closing high. 

Investor appetite for riskier assets drove safe-haven US Treasury yields higher, with the benchmark 10-year note yield climbing to a 1-1/2-month high of 2.225% overnight.

Higher US debt yields supported the dollar, which climbed to a 4-day high of 121.06 yen . The euro was flat at $1.0966 after shedding 0.5% overnight.

Markets remained firmly fixed on Friday's US non-farm payrolls report and whether the data will support the case for the Federal Reserve to hike interest rates in December.

Before Friday's non-farm payrolls, the markets will have a chance to gauge the health of the US economy through the ADP employment data and the ISM report on services sector sentiment due later in the session.

"We've seen nonfarm payrolls go in a completely different direction from ADP or ISM and we've also seen average hourly earnings or the unemployment rate trigger a U-turn after the initial reaction to payrolls," wrote Kathy Lien, managing director of FX strategy at BK Asset Management.

"So traders are rightfully sceptical about whether the labour market report will confirm the Federal Reserve's hawkish bias until the actual report is released."

Elsewhere in currencies, the New Zealand dollar licked its wounds after sliding 1.2% overnight on a further decline in dairy prices and soft jobs data.

The kiwi last traded little changed at $0.6658 .

Crude oil stepped back slightly on profit-taking. It surged overnight when US gasoline and diesel rallied following an outage on a key pipeline system. The outage added support to oil markets already boosted by strike in Brazil. 

US crude was down 0.3% at $47.77 a barrel after rallying 4% on Tuesday.