Asian stocks broadly rose Wednesday after US Federal Reserve chief Janet Yellen damped speculation of a rate hike before summer, and as eurozone finance ministers backed Greek reforms critical to avoiding a disastrous default.
The regional uptrend tracked fresh record highs on Wall Street and in Europe as investors breathed a cautious sigh of relief over the Greek package, which gives Athens a lifeline to pay its bills -- for now -- and sidestep an almost certain exit from the eurozone.
"The two potential international risk events for markets had positive outcomes," said Ric Spooner, chief market analyst at CMC Markets in Sydney.
"Janet Yellen's testimony moved expectations for a rate hike out in time while the boxes were ticked to cement a four-month funding programme for Greece."
Tokyo edged up 0.14 percent at the open, Sydney rose 0.28 percent, Seoul jumped 0.74 percent, while Wellington rallied 1.46 percent.
Chinese markets also rose at the open in the first day of trade after the week-long Lunar New Year holiday.
But Shanghai quickly reversed coursed, falling 0.38 percent, while Hong Kong also lost opening gains as it slipped 0.08 percent.
Global markets zeroed in on the start of Yellen's two days of congressional testimony, where she signalled that the Fed is deep in preparation for a rate hike this year, but she hinted such a move would not come before June.
"Yellen was decidedly noncommittal to the idea of a rate hike around the middle of the year," Omer Esiner, chief market analyst at the currency brokerage Commonwealth Foreign Exchange, told Bloomberg News.
"The reaction of the market is weaker dollar, lower yields, higher equities -- the classic reaction you'd see from a slightly dovish Fed."
- 'Many challenges ahead' -
Speculation has been rising over when the US central bank would pull the trigger on a rate hike, amid growing optimism over the state of the US economy.
But Yellen said the labour market still showed cyclical weakness and inflation continued to slow, adding that uncertainty over China and Europe posed a risk for the world's top economy, supporting the need to keep loose monetary policy in place a bit longer.
"A high degree of policy accommodation remains appropriate," Yellen told the Senate Banking Committee.
Wall Street embraced the comments with the Dow Jones Industrial Average and the broader S&P 500 both closing at record highs.
European stocks also rose strongly, with a record close in London, as eurozone finance chiefs backed a four-month extension of Greece's bailout.
Despite reservations expressed by the International Monetary Fund and European Central Bank over the plan, eurozone ministers signed off on promised reforms which Greece's new left-wing government submitted to meet a demand made by its international creditors at 11th-hour talks last week.
Several parliaments, including Germany's, must now approve the extension before the current bailout expires on Saturday, while key details will be hammered out in the coming weeks.
The euro held steady in Asian trading at $1.1347 and 134.68 yen, against $1.1342 and 134.90 yen in New York.
Yellen's rate-hike comments helped push the dollar down to 118.69 yen against 118.94 yen in US trade.
Oil prices were flat ahead of the release of a key US energy inventory report and as dealers digested President Barack Obama's decision to veto the construction of a key oil pipeline between the US and Canada, analysts said.
US benchmark West Texas Intermediate rose one cent to $49.29 while Brent crude gained 25 cents to $58.91 in mid-morning trade.
Gold fetched $1,209.81 an ounce against $1,198.59 late Tuesday.