Asian markets tacked on gains on Thursday morning, following a higher finish on Wall Street overnight.

Japanese benchmark index, the Nikkei 225, was up 2.61 percent as of 9.20 a.m. HK/SIN while across the Korean Strait, the Kospi gained 1.3 percent.

Down Under, S&P/ASX 200 traded up 1.65 percent, with all sectors but gold trading in the green. The energy sector led the gains, up 3.28 percent, while financials were up 1.58 percent.

IG's chief market strategist Chris Weston said in a morning note, "In terms of price action, the last few days has seen the ASX 200 roll over after the first half hour, so given the strong moves in US and European trade perhaps we will see stocks supported from the outset."

Banks and resources producers saw support with most major stocks trading up. Australia's so-called Big Four banks - ANZ, Commonwealth Bank of Australia, NAB, and Westpac - were up between 0.95 and 1.83 percent.

Miners such as Rio Tinto gained 2.64 percent, BHP Billiton up by 5.38 percent, and Fortescue tacking on 7.20 percent.

Japan's January exports slumped 12.9 percent

Earlier, Japan's Ministry of Finance released data that showed the country's January exports fell 12.9 percent at an annual rate on-year, worse than the market expectation of a 11.3 percent drop. Imports were down 18 percent on-year, with trade balance falling to a deficit.. Exports to China, one of Japan's biggest trading partners, slipped 17.5 percent in January.

Despite the disappointing trade numbers, most Japanese stocks, including the trading houses,that supply everything from energy to metals to grains and textiles in resource-scarce Japan, traded up. The big five trading houses, Mitsubishi, Mitsui, Sumitomo, Itochu, and Marubeni traded between 2.20 and 5.30 percent higher.

The yen strengthened against the dollar, with the dollar-yen pair trading down 0.19 percent at 113.88, compared to yesterday's close of 114.08. While a stronger yen is usually a negative for exporters as it reduces their overseas profits when converted into local currency, major exporters such as Toyota, Honda, and Sony traded up between 1.20 and 3.79 percent.

Japanese banks were up between 0.45 and 1.30 percent; Mitsubishi UFJ gained 1.25 percent.

The Japanese overnight call rate, which is the benchmark lending rate between banks, fell to negative levels on Wednesday. Earlier this week, Japan's negative interest rate policy kicked in as concerns over the long-term profitability of the banks lingered.

US crude gains 2 percent in Asian hours

The March contract for US crude was up 2.02 percent at USD 31.28 a barrel at 9.15 a.m. HK/SIN, while global benchmark Brent rose 1.13 percent at USD 34.89.

Energy plays across the region were mostly up; Santos gained 5.78 percent, Inpex added 5.29 percent, and Woodside Petroleum was up 3.35 percent.

Oil prices rose sharply overnight after an unexpected drop in crude inventories, which fell by 3.3 million barrels in the week to Feb. 12 to 499.1 million, compared with analysts' expectations for an increase of 3.9 million barrels.

The rise came after Iran's oil minister Bijan Zanganeh said that while he supported a production ceiling to stabilize oil prices - as mooted by big producers Saudi Arabia and Russia - it was the first of several steps that should be taken, according to Reuters reports that quoted the ministry's official Shana news agency.

OPEC ministers had traveled to the Persian state to talk about a possible production freeze deal between global oil producers.

Juan Prada from Barclays said in a note that though Iran did not commit to freezing its own output, "the market looked through Iran's apparent lack of commitment."

Overnight in the US

Stateside, the US Federal Reserve's January meeting minutes were released, in which policymakers worried that tighter global financial conditions could hit the US economy and considered changing their planned path for rate hikes in 2016.

Major indexes on Wall Street closed up; the Dow Jones industrial average gained 257.42 points, or 1.59 percent, at 16,453.83. The S&P 500 was up 31.24 points, or 1.65 percent, at 1,926.82 and the Nasdaq composite closed up 98.11 points, or 2.21 percent, at 4,534.06.

On the data front, a number of key economic numbers are due including January CPI and PPI numbers from the Chinese mainland.

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First Published:Feb 18, 2016 7:56 AM IST