Mumbai jumped more than three percent after India and Pakistan agreed a ceasefire at the weekend following four days of missile, drone and artillery attacks between the two countries which killed at least 60 people and sent thousands fleeing.
Pakistan’s stock exchange rocketed more than nine percent.
Oil prices jumped more than three percent owing to speculation easing China-US tensions would help demand. The dollar also advanced one percent against the euro and yen.
Gold, which rallied last month over a rush to safe havens, extended losses.
“The initial reaction to the weekend US-China talks (is) predictably encouraging,” said Chris Weston at Pepperstone.
However, Karsten Junius at Bank J. Safra Sarasin was cautious.
“We expect financial markets to remain volatile over the coming months, as they have almost fully priced out negative economic surprises and could once again be disrupted by more serious obstacles in trade negotiations,” he said in a commentary.
“In all likelihood, things may still get worse before they get better.”
Investors are also awaiting the release this week of data on US inflation and retail sales, which will provide a fresh snapshot of the world’s biggest economy since the tariffs were first unveiled.
– Key figures at around 0715 GMT –
Tokyo – Nikkei 225: UP 0.4 percent at 37,644.26 (close)
Hong Kong – Hang Seng Index: UP 3.3 percent at 23,630.68
Shanghai – Composite: UP 0.8 percent at 3,369.24 (close)
London – FTSE 100: UP 1.1 percent at 8,645.25
Euro/dollar: DOWN at $1.1104 from $1.1257 on Friday
Pound/dollar: DOWN at $1.3289 from $1.3308
Dollar/yen: UP at 147.89 yen from 145.31 yen
Euro/pound: DOWN at 84.44 pence from 84.57 pence
West Texas Intermediate: UP 3.6 percent at $63.24 per barrel
Brent North Sea Crude: UP 3.4 percent at $66.11 per barrel
New York – Dow: DOWN 0.3 percent at 41,249.38 (close)
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