Asian shares extended their gains on Tuesday as hopes for stimulus in major economies tempered anxiety about a global recession, helping boost riskier assets and drawing money from safe-havens such as bonds and gold. MSCI`s broadest index of Asia-Pacific shares outside Japan nudged up 0.04%, while Japan`s Nikkei jumped 0.47%. The improved mood was helped by a rally on Wall Street overnight, with the S&P 500 gaining 1.21%.

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Oil futures were also down in a tentative sign that worries about an attack at a Saudi oil field over the weekend have eased, but some traders were nervously monitoring an Iranian tanker at the centre of a clash between Tehran and Washington. For now, however, investors were cheered by signs policymakers were willing to do more to support their economies in the grip of international trade frictions, led by the bruising Sino-U.S. tariff tussle. 

The immediate focus shifts to the minutes of the U.S. Federal Reserve`s last meeting due on Wednesday. Traders are also keenly waiting on the Fed`s Jackson Hole seminar and a Group of Seven summit this weekend for clues on what additional steps policymakers will take to bolster growth.

Senior White House officials are discussing a temporary payroll tax cut to boost the economy, the Washington Post reported on Monday.

Hopes for additional stimulus are rising after reports that Germany is prepared to increase fiscal spending, and after the People`s Bank of China took steps to lower corporate borrowing costs. 

"There are expectations for looser monetary policy everywhere in the world, and this is cushioning the markets against recent uncertain developments," said Masayuki Kichikawa, chief macro strategist at Sumitomo Mitsui Asset Management Co.

"China is prepared to do a lot for its economy. I hope to hear more about fiscal spending in Germany. Central banks have no choice but to ease. The remaining question is what comes from fiscal policy."

U.S. stock futures were a shade lower in Asian trading, down 0.15%, while benchmark 10-year Treasuries yields eased slightly to 1.5944%, and 2-year yields traded at 1.5289%. 

Markets overwhelmingly expect the Fed to cut rates again at its Sept. 17-18 policy meeting from the current 2.00%-2.25%. The Fed cut rates in July for the first time in a decade to mitigate the effects of the U.S.-China trade row and a global slowdown.

Last week, financial markets went into a tailspin after the Treasury yield curve briefly inverted when short-term yields traded above those of long-term paper. Investors, who feared a steep global downturn given an inverted yield curve has presaged several past U.S. recessions, dumped riskier assets. 

However, a bounce in yields from lows hit last week has eased some of the concerns about the global economy. Gold , which is traditionally bought as a safe-haven during times of uncertainty, held steady at $1,497.02 per ounce after tumbling 1.2% on Monday, its biggest daily decline in about a month.

The Swiss franc , another safe-haven asset, was last quoted at 0.9810 per dollar, near a two-week low. In the oil market, U.S. West Texas Intermediate futures fell 0.41% to $55.98 a barrel in a sign of receding concern about tension in the Middle East, but some traders warn this lull could be temporary.

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Refinitiv data shows an Iranian tanker that was detained in Gibraltar is now on its way to Greece, but the U.S. State Department has warned that any assistance to the vessel could be considered as providing support to a U.S.-designated terrorist organisation.