Asia stocks gain after Wall Street takes Paris attacks in stride

Asian stocks gained early on Tuesday, taking heart after seeing Wall Street take the attacks in Paris in stride and surge overnight, while expectations for a rate hike by the Federal Reserve in December kept the dollar on a bullish footing.

MSCI's broadest index of Asia-Pacific shares outside Japan rose 0.3%. Australian shares gained 0.8%. Japan's Nikkei added 1.3%.

Wall Street had its strongest session in three weeks on Monday, as investors bet Friday's attacks in Paris would have little long-term impact on the US economy and corporate earnings. The Dow rose 1.4% and the S&P 500 surged 1.5%.

European equities also held firm on Monday, with the pan-European FTSEurofirst 300 index edging up 0.16% and France's CAC was down only 0.12%.

 

"In light of all the tragedy in France, it is refreshing to see that the terrorists did not successfully terrorise the financial markets...and even though investors sold the EUR/USD, the decline could have been a lot steeper. In fact we did not see any unusually large moves in currencies," wrote Kathy Lien, managing director of FX Strategy for BK Asset Management.

The dollar stood near a 1-week high of 123.33 yen >, a safe-haven currency usually sought in times of geopolitical tension. The dollar also stood tall against the Swiss franc, another safe-haven, after advancing to an 8-month high.

The euro was steady at $1.0688 > after losing about 0.9% overnight.

Oil continued gaining after the Paris attacks raised geopolitical tensions that were seen to threaten global oil supply. 

US crude was up 0.3% at $41.87 a barrel.

Spot gold > was little changed at $1,083.40 an ounce, after the precious metal pared gains overnight as an initial flow of safe-haven buying following the attacks in Paris petered out. Investor focus has returned to a potential rate hike by the Fed in December.