Asian shares mixed as Dow hits two-year highs

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Tokyo's Nikkei ended the session up 0.41 per cent, or 43.94 points, at 10,635,98, a level not seen since last May.

Toyota Motor said after the closing bell that its net profit for the nine months to December had nearly quadrupled, despite a 39 per cent fall in the third quarter, rounding off an earnings season that has buoyed Japanese stocks.

Sydney closed 0.45 per cent, or 21.9 points, higher at 4,890.4, a 10-month high, as financial firms were given a lift by their US peers.

Hong Kong ended the morning session 0.46 per cent lower, with resource firms hit by falling crude prices as investors eye a calmer outlook for Egypt.

Shanghai remained closed for the Lunar New Year break.

Traders were given a strong cue by Wall Street, where the Dow Jones Industrial Index jumped 0.57 percent to its strongest finish since June 2008, while the Nasdaq gained 0.53 per cent and the S&P 500 picked up 0.62 per cent.

The US markets were lifted by an improving outlook for the economy, which has in turn provided a fillip to global shares, dealers said.

"I still think the tone is mildly bullish and people are cautiously investing more in the market," said BBY senior institutional trader Peter Copeland in Sydney.

He added that the "geopolitical situation (in Egypt) appears to be settling down, with oil prices edging lower".

Traders were buoyed by receding fears that the chaos in Egypt -- where anti-government protesters are calling for President Hosni Mubarak to step down -- could spread to the rest of the region.

The deadly demonstrations last week in Cairo's Tahrir Square had raised concerns of regional instability but those worries eased slightly after Vice President Omar Suleiman met opposition groups on Sunday.

Oil was off recent highs, with Brent North Sea crude for March delivery at $99.34. The contract has slipped from above $100 where it had been over the past week amid fears that supply could be at risk.

Although Egypt is not a major crude producer, it is home to the Suez Canal, which carries about 2.4 million barrels daily, roughly equal to Iraq's output.

New York's main contract, light sweet crude for delivery in March, rose nine cents to $87.57.

On currency markets the euro bought $1.3624 in Asian afternoon trade, up from $1.3581 in New York late Monday. Against the Japanese unit, the common European currency rose to 112.05 from 111.78.

The dollar was at 82.22 yen, slightly down from 82.32 yen.

Gold opened at $1,350.50-$1,351.50 an ounce in Hong Kong, up from Monday's close of $1,347.50-$1,348.50.

In other markets:

-- Seoul dropped 0.58 per cent, or 12.04 points, to 2,069.70, with shipbuilders falling on profit-taking and worries about higher raw material costs.

-- Manila ended flat, edging down 1.55 points to 3,878.48.

First Philippine Holdings fell 1.1 percent to 60.70 pesos and Ayala Land was down 0.3 per cent at 15.06, while conglomerate Alliance Global Group was up 2.0 per cent at 11.98.

-- Wellington fell 0.13 per cent, or 4.24 points, to 3,383.17.

Fletcher Building lost 0.1 per cent to NZ$8.22 and Telecom ended down 1.4 per cent to NZ$2.18 while resins maker Nupex was up 1.1 per cent at NZ$3.67.

-- Taipei fell 0.37 per cent, or 33.89 points, to 9,111.46.

Taiwan Semiconductor Manufacturing Company closed 1.05 per cent lower at Tw$75.5, while electronic goods maker Hon Hai Precision edged down 0.4 per cent to Tw$124.5.