WBC Westpac Banking Corp

Asian markets rose Tuesday, as a weakening yen lifted Japanese shares and higher oil prices boosted the energy sector.

The Nikkei Stock Average rose 1.3%, Australia's S&P/ASX 200 rose 1.1% and South Korea's Kospi gained 0.9%.

The Hang Seng Index rose 1.5% while the Shanghai Composite Index was 0.9% higher.

The gains follow a jittery Monday, when terror attacks in Paris drove investors toward haven assets like gold and government bonds, and out of riskier investments like equities. Many analysts predicted the market impact would be short-lived, given a pattern of resilience after past attacks in other major global cities.

Energy stocks on the S&P/ASX 200 rose 1.3%, after U.S. oil prices gained 2.5% overnight. Energy shares had also helped the Dow Jones Industrial Average recover from its first week of losses in nearly two months.

"There are signs that the market is not so much brushing off the financial implications of the Paris attack," given a continued selloff in the euro, but that the intensity of the initial response has eased, said Sean Callow, a currency strategist at Westpac Banking Corp. For example, haven appeal of the yen, which reached its strongest level in a week against the dollar on Monday, has started to abate, he added.

Investors sold the euro overnight, as investors sought protection in the U.S. dollar. Firming expectations of higher interest rates in the U.S. also drove U.S. Treasury yields higher and spurred expectations of a stronger dollar. Overnight, both factors led to selling of the Japanese yen, which had strengthened in the immediate aftermath of the Paris attacks as investors rushed to safe haven assets.

The Japanese yen is now nearing its weakest level in about a week, last at ¥ 123.23 per U.S. dollar compared with around ¥ 123.05 late afternoon in Asia on Monday.

The euro was last at $1.0685, near its lowest level in 7 months. It was as weak as $1.6099 Tuesday in Asia.

In Australia, higher oil prices helped energy producers recover from heavy selling last week. Mining giant BHP Billiton Ltd., whose share price tumbled to multiyear lows last week, has good chances to stabilize at just above 20 Australian dollars a share, said Mathan Somasundaram, a quantitative strategist at financial advisory firm Baillieu Holst Ltd. Shares of BHP rose 1.1% to A$20.33 early Tuesday.

In Australia, the central bank said earlier Tuesday that low inflation gives it scope to cut interest rates should economic growth falter, though the economy appeared to be improving.

The Bank of Indonesia is expected to keep interest rates unchanged at 7.5% when it meets later Tuesday.

Brent crude oil was up 0.3% at $44.67 a barrel.

Gold prices were flat at $1,082.70 a troy ounce.

Vera Sprothen contributed to this article.

Write to Chao Deng at Chao.Deng@wsj.com

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(END) Dow Jones Newswires

November 16, 2015 21:25 ET (02:25 GMT)

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