HONG KONG (REUTERS, BLOOMBERG) - Asian share markets mostly rose on Tuesday (Nov 10) as global investors applauded successful trial data for a coronavirus vaccine, although expected delays to any mass roll-out took the gloss off early gains.

Legal challenges to the US election outcome, concerns about a smaller US fiscal stimulus package and still surging coronavirus cases also weighed on investor sentiment.

S&P 500 futures fell 0.7 per cent as of 6am in London.

Major Asian markets soared on the vaccine news before weakening later in the session.

Japan's Nikkei 225 ended up nearly 0.3 per cent after being 1.1 per cent higher in early trading, touching a 29-year high.

Australia's S&P/ASX 200 closed 0.66 per cent higher after trading up as much as 1.6 per cent, while South Korea's Kospi index closed up 0.2 per cent.

Hong Kong's Hang Seng index was at 0.87 per cent in the afternoon after rising 1 per cent in early trade the Shanghai Composite Index fell 0.3 per cent.

Analysts attributed the decline in China market to the heavy exposure of its indices to tech stocks, which came under pressure as investors eyed less consumer reliance on technology if a vaccine leads to an easing of movement restrictions.

In Singapore, however, stocks held onto their strong gains after news that the nation could have a Covid-19 vaccine by early next year.

Arcturus Therapeutics, the US pharmaceutical company working with Duke-NUS scientists on a vaccine said on Tuesday that first shipments are expected in the first quarter of 2021, as they announced positive preliminary results from the early-stage clinical trials ongoing in Singapore.

The Straits Times Index (STI) was up 2.9 per cent to its highest since June at 2.51pm local time.

Among the biggest gainers on the STI was Singapore Airlines which was up 45 cents or 13 per cent to $3.88, while Shangri-La Asia rose 73 HK cents or 11.2 per cent to HK$7.23. Casino and cruise operator Genting Singapore rose 4.5 cents or 6.5 per cent to 73.5 cents.

Airline, travel and tourism stocks across Asia had rallied on optimism prompted by the vaccine announcement.

Qantas Airways closed 8.3 per cent higher to hit its highest level since March, Japan Airlines shot 20.6 per cent per cent higher and ANA Holdings rose 17.5 per cent.

In Hong Kong, Cathay Pacific Airways shares jumped 13 per cent, the best since July.

On Monday, the Dow Jones Industrial Average jumped 2.95 per cent and the S&P 500 gained 1.2 per cent on news the coronavirus shot being developed by Pfizer and BioNTech SE prevented over 90 per cent of infections. The Nasdaq 100 fell as investors rotated out of defensive technology names into shares depressed by the economic impact of lockdowns.

Investors pulled out of defensive assets and poured cash into markets that are closely tied to economic growth. The top infectious disease expert in the US, Anthony Fauci, said the shot being developed by Pfizer will have a "major impact" on everything we do with regards to Covid-19 going forward.

Still, experts cautioned questions remained before the shot is rolled out. And while an antibody therapy from Eli Lilly & Co was granted emergency-use authorization in the US, adding to optimism on the vaccine front, uncertainty remains in the race for immunization. The final-stage trial of a frontrunner Chinese vaccine candidate was halted in Brazil due to a serious adverse event.

"There are obvious questions about the sustainability of positive vaccine news flows - from efficacy, to scalability, to side effects, to distribution/refrigeration issue," said Michael Purves, chief executive officer at Tallbacken Capital Advisors.

News of the vaccine's potential success came as the US surpassed 10 million Covid-19 cases on Monday and appeared poised to hit record hospitalizations later this week. President-elect Joe Biden warned the nation faced a "dark winter" and announced a new coronavirus task force as his transition team seeks to fulfill a campaign promise to contain the outbreak.

The Australian dollar fell 0.08 per cent versus the greenback at US$0.7279.

The yen strengthened 0.38 per cent to 104.96 per dollar, while sterling was last trading at US$1.3182, up 0.14 per cent on the day.

The vaccine news also sent long-dated U.S. Treasury yields sky-rocketing in their biggest one-day jump since March. The yield curve, an indication of risk appetite, hit its steepest level since March.

Bonds had their biggest selloff since recoiling from March peaks. The yield on benchmark 10-year U.S. government debt , which rises when prices fall, jumped 10.3 basis points on Monday and held above 0.9 per cent on Tuesday at 0.9099 per cent.

The CBOE Market Volatility index, a barometer of investor anxiety, hit its lowest closing level since late August.

Oil prices lost momentum in Asian trade. Light crude oil fell by 1.49 per cent to US$39.74 a barrel while Brent crude slipped 1.06 per cent.

Spot gold added 1 per cent to US$1,880.26 an ounce.

With additional information from The Straits Times