Tokyo, Jan 7 (AP) Asian shares mostly rose Tuesday, deriving optimism from rising technology stocks on Wall Street, led by Nvidia.

Japan's benchmark Nikkei 225 jumped 2.2 per cent to 40,164.53. Australia's S&P/ASX 200 edged up 0.3 per cent to 8,285.10. South Korea's Kospi added 0.4 per cent to 2,497.75.

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Hong Kong's Hang Seng index slid 1.9 per cent to 19,316.53 as shares in technology and games company Tencent plunged 7.8 per cent after it was hit by US sanctions.

The Shanghai Composite edged 0.1 per cent higher to 3,209.94.

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Nippon Steel, whose attempt to take over US Steel is being blocked by the Biden administration, slid 1.5 per cent in Tokyo trading, shortly after its chief executive vowed to keep pushing the deal.

US Steel climbed 8.1 per cent overnight after it and Japan's Nippon Steel filed a federal lawsuit challenging President Joe Biden's decision to block a proposed nearly USD 15 billion deal for Nippon to buy its Pittsburgh-based rival.

The suit, filed in the US Court of Appeals for the District of Columbia, alleges it was a political decision. Japanese leaders have also said there is scant evidence the merger poses a security concern for the US.

Investors are also watching for possible policy changes under incoming President Donald Trump, whose term is beginning soon, said Stephen Innes, managing partner at SPI Asset Management.

"The convergence of these financial indicators points to a heightened alert among traders, who carefully calibrate their strategies for potential shifts in policy and economic directives that the new administration may bring," he said.

US indexes recovered more of a holiday-season slide that bridged the new year. The S&P 500 added 0.6 per cent to 5,795.38 for a second straight gain following five straight losses, its longest losing streak since April. The Dow Jones Industrial Average lost an early gain to slip 0.1 per cent to 42,706.56, and the Nasdaq composite gained 1.2 per cent to 19,864.98.

Slightly more stocks fell in the S&P 500 than rose amid the mixed trading. Tech companies were the clear leaders, including those swept up in the frenzy around artificial-intelligence technology.

Nvidia climbed 3.4 per cent to top its record set in November ahead of a speech by CEO Jensen Huang at the annual CES convention in Las Vegas after trading ended for the day.

Nvidia and other AI stocks have kept climbing despite concern that their stock prices have already shot too high, too fast. Despite worries about a potential bubble, the industry continues to talk up its potential.

Uber Technologies drove 2.7 per cent higher after the ride-hailing app said it would accelerate USD 1.5 billion in purchases of its own stock, part of a previously announced USD 7 billion buyback program.

The New York Stock Exchange and Nasdaq will close their stock and options markets on Thursday in observance of a National Day of Mourning for former President Jimmy Carter.

But in a potentially market-moving event later in the week, the Federal Reserve will release minutes from its last policy meeting, where it cut its main interest rate for a third straight time.

The monthly jobs report, along with an update on how US consumers are feeling, are set for Friday. So far, the economy has remained remarkably resilient. The Fed began cutting interest rates in September after inflation pulled nearly all the way down to its 2 per cent target.

Getting the last percentage point of improvement from inflation may prove more difficult. Worries are also rising that tariffs and other policies coming from President-elect Donald Trump could push inflation higher.

That's caused worries about rates staying higher than expected, and longer-term Treasury yields have climbed in the bond market. The yield on the 10-year Treasury was at 4.61 per cent, up from 4.60 per cent late Friday.

In energy trading, benchmark US crude declined 8 cents to USD 73.48 a barrel. Brent crude, the international standard, fell 2 cents to USD 76.28 a barrel.

In currency trading, the US dollar rose to 157.87 Japanese yen from 157.65 yen. The euro cost USD 1.0398, up from USD 1.0391. (AP)

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