Australia

Australian shares are set to edge lower with US markets closed for Memorial Day. Asian and European markets climbed higher as Chinese authorities announced plans to wind back lockdowns.

ASX futures were down 12 points or 0.1% at 7271 as of 8.00am on Tuesday, pointing to a modest fall at the open.

Futures for the S&P 500 gained 0.6% by noon New York time (2am AEST). The US stock market is due to reopen Tuesday.

Global markets were boosted by the looming relaxation of some Covid-19 curbs in China.

Japan's Nikkei 225 jumped 2.2%, the Shanghai Composite Index advanced 0.6%, European stocks rose 0.6% and London's FTSE edged up 0.2%.

Shanghai's Vice Mayor Wu Qing said over the weekend that authorities will loosen the conditions under which companies are able to resume work this week, and the city's government laid out a 50-point plan for accelerating the economic recovery. The measures include tax cuts for businesses and subsidies for purchases of electric vehicles, the official Xinhua News Agency said.

Locally, the S&P/ASX 200 closed 1.4% higher at 7286.6, posting its largest rise for more than two weeks amid near widespread gains.

The benchmark built on Friday's momentum from US stocks, jumping at the open and grinding upwards to finish at its session high. It is the first time in a month that the ASX 200 has gained more than 1% in consecutive sessions.

Tech stocks led the rally with Xero, Megaport and Block adding between 5.2% and 11%.

Iron-ore, gold and lithium miners all rose as the materials sector put on 2.2%. Utilities was the only sector to fall, slipping 0.7% as AGL scrapped its demerger plans and dropped 1.7%.

Commodity markets scaled higher as China eased lockdowns, Brent crude oil rose 1.9% to US$121.67 a barrel. Iron ore added 1.6% to US$136.60. Gold was up 0.1% at US$1859.30.

In local bond markets, the yield on Australian 2 Year government bonds slipped to 2.35% while the 10 Year was flat at 3.25%. US bond markets were closed for a public holiday.

The Australian dollar traded at 71.95 US cents as of 7.00am on Tuesday, up from the previous close of 71.58 US cents. The Wall Street Journal Dollar Index, which tracks the US dollar against 16 other currencies edged lower to 94.10.

Asia

Chinese shares ended higher, supported by improved sentiment after Shanghai authorities announced plans to ease Covid restrictions as well as measures to support an economic recovery. Sentiment was also partly supported by recent upbeat earnings from large Chinese tech names, which helped to ease worries about the economic impact of lockdowns, UOB analysts said in a note. China's official May PMI surveys later this week will be in focus, UOB added. The Shanghai Composite Index advanced 0.6% to 3149.06, the Shenzhen Composite Index rose 1.1% to 1975.89 and the ChiNext Price Index gained 1.2% to 2350.38. Aviation stocks rose, with China Southern Airlines climbing 2.4% and Air China adding 1.6%.

Hong Kong shares are higher, with the benchmark Hang Seng Index rising 1.2% to 20951.86, as fresh stimulus from Beijing supports. Consumer stocks are higher, with financial support for companies including tax relates and reduced rents likely to help downplay Covid-19-related concerns, says IG market strategist Yeap Jun Rong, noting that daily Covid-19 cases in Shanghai and Beijing were lower over the weekend. That said, Yeap notes that the HSI has been trading rangebound since April, and puts resistance for the index at 21200. Li Ning advances 8.2%, Haidilao gains 6.1% and China Resources Beer adds 5.3%.

Japanese stocks ended higher, led by gains in electronics stocks, as fears eased over US inflation and higher borrowing costs. Medical-equipment maker Sysmex jumped 9.1% and air-conditioner maker Daikin Industries added 6.5%. The Nikkei Stock Average rose 2.2% to 27369.43.

Europe

European markets rose as investors waited on economic events later in the week. The pan-European Stoxx Europe 600 rose 0.6%, the French CAC 40 and German DAX advanced 0.8%.

"Limited morning gains have shrunk as the day has gone on, as investors struggle to find a reason to drive equities higher," IG analyst Chris Beauchamp says in a note. "All eyes will be on the US tomorrow to see if Wall Street can put new energy into the bounce, or whether the usual pre-non farm payroll nervousness will make an early appearance."

London’s FTSE 100 climbed 0.2% on Monday, but losses from some of its largest stocks partially offset gains across the rest of the index, which ended up underperforming markets in mainland Europe.

Pharmaceutical giants AstraZeneca and GSK dropped 1.1% and 0.3% respectively, British American Tobacco fell 2.7% and lender HSBC closed 0.7% lower.

On the green part, the best performers included manufacturing group Melrose, fashion retailer JD Sports and copper producer Antofagasta.

"European markets have got the week off to a positive start, helped by a strong Asia session after authorities in Shanghai said businesses could start to reopen on June 1, as Omicron cases continued to fall," Michael Hewson from CMC Markets UK said in a note.

North America

US share markets were closed for a public holiday.