Reuters file photo
Most Asia markets rose Monday as investors built on last week's rally, with another healthy lead from Wall Street providing support, but oil prices retreated from their three-and-a- half-year highs.
Malaysia's ringgit sank almost one percent but stocks were up 0.5 percent in Kuala Lumpur as trading resumed after last week's general election that saw a shock win for 92-year-old former premier Mahathir Mohamad, reports AFP.
While analysts had expected a sharp drop in equities, they said Mahathir had soothed many concerns by giving key posts to people seen as market- friendly.
"We have turned mildly positive over the short term," Danny Wong, chief executive officer at Areca Capital, told Bloomberg News.
"Most of the local funds have turned slightly positive with more clarity from Mahathir after he announced the 10 key ministries plus an elder council. Confidence is returning."
Investors will be keeping a close eye on China-US trade talks this week, with President Xi Jinping's top economics official and Vice Premier Liu He visiting Washington after a high-level meeting in Beijing earlier in May ended without any agreement.
Hopes that the two sides can avert a trade war were boosted Sunday when Donald Trump said he was working with Xi to prevent telecom giant ZTE from going out of business after it was hit by a US technology sales ban.
He tweeted that he had asked officials to come up with a rescue plan, saying too many jobs were at risk, seeming to offer an olive branch.
- Oil prices retreat -
Hong Kong led gains in Asia Monday, surging 1.4 percent, while Shanghai added 0.4 percent.
Tokyo ended the morning up 0.2 percent, with Fujifilm climbing more than one percent after US photocopier and printer maker Xerox pulled out of a $6.1 billion merger deal. Analysts said the move was welcomed by traders who thought the deal was not good for Fujifilm.
Sydney climbed 0.3 percent and Wellington gained 0.2 percent while Taipei piled on 0.8 percent.
However, Seoul and Singapore were in negative territory.
Oil prices retreated, extending Friday's losses, after reaching highs not seen since November 2014 in response to Trump's decision to pull out of the Iran nuclear deal.
A pick-up in demand, economic uncertainty in major producer Venezuela and the ongoing output cap by OPEC and Russia are keeping the commodity buoyant.
However Stephen Innes, head of Asia-Pacific trading at OANDA, warned: "The one possible concern is the developing indications that point Saudi Arabia alleviating the effect of the sanctions by increasing output to counter the Iran disruption.
"That also raises the spectre that other OPEC countries will follow suit, which could put the current... supply deal in jeopardy."
On currency markets the dollar dipped against its main peers but with US interest rates expected to rise at least twice more this year, analysts are tipping it to strengthen further.
"Given the dovish display by other central banks, the lonely Federal Reserve board appears to be the last man standing as speculation about interest rate rises and policy normalisation in the eurozone, Japan and Britain get kicked down the road," Innes said.
- Key figures around 0300 GMT -
Tokyo - Nikkei 225: UP 0.2 percent at 22,813.37 (break)
Hong Kong - Hang Seng: UP 1.4 percent at 31,559.59
Shanghai - Composite: UP 0.4 percent at 3,175.28
Euro/dollar: UP at $1.1966 from $1.1943 at 2100 GMT on Friday
Pound/dollar: UP at $1.3572 from $1.3542
Dollar/yen: DOWN at 109.23 yen from 109.29 yen
Oil - West Texas Intermediate: DOWN 13 cents at $70.57 per barrel
Oil - Brent North Sea: DOWN 20 cents at $76.92 per barrel
New York - Dow: UP 0.4 percent at 24,831.17 (close)
London - FTSE 100: UP 0.3 percent at 7,724.55 (close)