HONG KONG (AFP) - Agreement on a Pacific-wide free-trade agreement and hopes major central banks will maintain extra-loose monetary policies fired another rally in Asian markets on Tuesday (Oct 6), tracking advances in Europe and New York.
Tokyo was 1.30 per cent higher, Sydney gained 0.85 per cent and Seoul was 0.80 perc ent up. Shanghai was closed for a public holiday while Hong Kong added 0.58 per cent.
The Straits Times Index was up 1.1 per cent at 2,882.88 as of 10:59 am.
With the likelihood of a US rate rise this year receding, the US dollar weakened against higher-yielding, or riskier, units.
The Indonesia's rupiah surged more than two per cent against the greenback, while South Korea's won was up 0.78 per cent and the Australian dollar was 0.10 per cent higher.
The Indian rupee, Taiwan dollar and Malaysian ringgit were also up.
In Hong Kong, shares in mining giant Glencore added to the previous day's surge following reports it is in talks to sell its agriculture business as it battles weakening demand for raw materials.
But the main focus was on the Trans-Pacific Partnership (TPP), which will see the easing of a number of barriers, including to Japan's closeted farm sector and the US car market.
After five years, trade representatives from 12 nations on the Pacific Rim said Monday they had finally hammered out a deal to create the world's biggest free trade area - encompassing 40 per cent of the world economy.
It earned a strong endorsement from International Monetary Fund chief Christine Lagarde, who said it was "not only important because of the size... it also pushes the frontier of trade and investment in goods and services to new areas where gains can be significant".
Analysts said the news would boost stocks in the region, adding to an already upbeat mood among investors.
Toshihiko Matsuno, chief strategist at SMBC Friend Securities Co. in Tokyo, told Bloomberg News the TPP "has a lot of potential to become a big deal for the US and Japan.
"Concerns over the global economy had become ingrained in the market's mindset. It's possible that the TPP has triggered some regret over having sold too much."
Confidence on Asia's trading floors was already buoyant after Friday's below-forecast US jobs numbers, which raised fears that the recent turmoil in global economies was filtering through to the world's biggest.
The report also muddied the waters for the Fed as it considers raising rates, with many experts saying its timeline for a hike before 2016 has likely been scuttled.
Japan's central bank holds a two-day policy meeting from Tuesday, with speculation it will widen its already vast stimulus programme to try to reinvigorate the struggling economy, while its European counterpart is also considering further easing.
"Markets continue to believe that weak data will pressure central banks in Europe and Japan to provide more stimulus and will delay the US Fed in its pursuit to begin withdrawing monetary stimulus," Matthew Sherwood, head of investment strategy at Perpetual Ltd. in Sydney said in a note to clients.
This "continues to have investors believe that asset prices can defy the weak growth environment".