Asia markets opened higher on the first day of the new quarter, tracking global stocks' third day of recovery from the post-Brexit sell-off.

Australia's ASX 200 was up 0.7 percent, with most sectors trading up. In Japan, the Nikkei 225 was up 0.77 percent, while across the Korean Strait, the Kospi was higher by 0.79 percent.

In the currency market, the British pound continued to wobble amid fresh political surprises and after Bank of England Governor Mark Carney said in a speech that the economic outlook of the UK has deteriorated following its decision to quit the European Union. He said some monetary policy easing will likely be required over the summer.

The British pound climbed to USD 1.3343, compared with Thursday's levels near USD 1.3405 during Asian hours. Cable had tumbled to near USD 1.3225 in the wake of Carney's remarks overnight.

"Sterling dropped like a hard rock after Bank of England (BOE) Governor Carney said another rate cut is coming this summer," said Kathy Lien, managing director of foreign exchange strategy at BK Asset Management.

"Carney also warned that the BOE can react more rapidly than other institutions and the central bank will have its first full projections in August - which means we'll be looking for a move around that time," Lien added.

The pound had briefly jumped on Thursday after Boris Johnson, one of the architects of the campaign for the UK to exit the European Union (EU), issued a surprise announcement that he wouldn't enter the race to be the country's next prime minister, adding another layer of political uncertainty.

Among other currency majors, the dollar traded at the 95 handle against a basket of currencies. The dollar index was at 95.814 as of 8:27 a.m. HK/SIN. The Japanese yen weakened further to 103.00 against the dollar, compared with Thursday's levels near 102.48 in the afternoon local time.

Gains in haven assets were slightly muted as investors returned to riskier assets.

Gold prices were flat in early trade on Friday, hovering at USD 1,321.70 an ounce; this was compared to the highs near USD 1,335 reached in the previous week amid volatility in markets following the Brexit vote.

Bond yields also came off record lows; the yield on the 10-year Japanese government bond was at negative 0.226 percent, similar to Thursday's level at negative 0.225 percent.

However, the amount of negative-yielding global debt jumped to USD 11.7 trillion, a 12.5 percent increase since the end of May, according to a Fitch Ratings report Wednesday.

Government data in Japan showed core consumer prices, which exclude fresh food prices, fell 0.4 percent in May on-year in line with expectations. Core consumer prices in Tokyo for June dropped 0.5 percent on-year, also in line with expectations.

A survey from the Bank of Japan showed business sentiment among Japanese manufacturers stood at plus 6, a touch better than the median market forecast of plus 4. Sentiment among big non-manufacturers fell from plus 22 to plus 19, according to the survey. Reaction to the survey in markets was muted.

Stateside, the Dow Jones industrial average closed up 235.31 points, or 1.33 percent, at 17,929.99; the S&P 500 index was up 28.09 points, or 1.36 percent, at 2,098.86 and the Nasdaq composite was up 63.43 points, or 1.33 percent, at 4,842.67.

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First Published:Jul 1, 2016 7:42 AM IST