The easing of tensions in the Middle East has seen oil prices slip AFP

Markets mostly rose Tuesday following advances on Wall Street, while the yen held gains after the previous day's sharp swings and focus turned to the Federal Reserve's upcoming policy decision.

A forecast-beating series of earnings from top-tier firms in recent weeks, particularly tech titans including Alphabet and Microsoft, has been a key driver of the latest advances, offsetting fading hopes for a US interest rate cut this year.

While the Fed is widely expected to stand pat on borrowing costs after its meeting Wednesday, its statement and boss Jerome Powell's comments will be pored over for clues about their plans for the rest of the year.

Traders have been lowering their expectations since the start of 2024 for how many reductions the bank will make as inflation continues to hold above target and various indicators show the economy and labour market remain in rude health.

Still, investors have largely come to terms with the fact that interest rates will remain elevated for an extended period and are taking heart from the strong corporate reports.

Closely watched jobs data is due to be released at the end of the week, while Apple, Coca-Cola and Pfizer are pencilled in to announce quarterly earnings.

Asian markets were largely higher Tuesday, though profit-taking after a recent run-up pared the morning's healthy gains.

Hong Kong rose for a seventh successive day, while Sydney, Seoul, Singapore, Wellington, Mumbai, Bangkok and Jakarta were also up.

Shanghai, Taipei and Manila edged down.

London, Paris and Frankfurt were all up.

News that China's April factory activity grew more than expected -- even if at a slower pace than last month -- also provided some support.

Tokyo piled on more than one percent as it played catch-up with Asia's gains on Monday, which was a Japanese holiday.

The yen weakened slightly but held much of the previous day's surge that observers speculate came on the back of an intervention by authorities after it hit a fresh 34-year low of 160.17.

The unit was sitting around 156.80, having rallied to 154.54 at one point Monday.

Traders are on guard for further volatility in the pairing after the Bank of Japan decided against shifting further from its ultra-loose monetary policy last week and gave little idea about when it would.

That makes the Fed's meeting even more crucial, with observers warning that a more hawkish tilt could see the dollar spike again, though many warn the yen will likely hit 160 again owing to the wide differences in the central banks' monetary policies.

"Going back to 160 again is pretty much in sight, unless the macroeconomic situation changes," said Yusuke Miyairi of Nomura International.

He added that "the market is not too afraid of fighting the (Ministry of Finance) in terms of the currency".

Oil prices extended losses on hopes for a possible ceasefire in Gaza, with US President Joe Biden said to be calling for Egypt and Qatar to "exert all efforts" towards securing the release of hostages held by Hamas as part of negotiations.

Hamas is expected to respond to a proposal for a second truce in Gaza, coupled with a fresh release of hostages.

Tokyo - Nikkei 225: UP 1.2 percent at 38,405.66 (close)

Hong Kong - Hang Seng Index: UP 0.1 percent at 17,758.75

Shanghai - Composite: DOWN 0.3 percent at 3,104.82 (close)

London - FTSE 100: UP 0.2 percent at 8,160.87

Dollar/yen: UP at 156.76 yen from 156.09 yen on Monday

Euro/dollar: DOWN at $1.0702 from $1.0725

Pound/dollar: DOWN at $1.2531 from $1.2564

Euro/pound: UP at 85.41 pence from 85.34 pence

West Texas Intermediate: DOWN 0.3 percent at $82.39 per barrel

Brent North Sea Crude: DOWN 0.2 percent at $88.20 per barrel

New York - Nasdaq Composite: UP 0.4 percent at 15,983.08 (close)