 "Asian shares mostly rise, dollar takes breather")
A pause in the dollar's rise helped commodities prices stabilise, with gold gaining 1% to recoup losses incurred the previous session.
The dollar shed 0.3% against a basket of key currencies, after nearing this year's high of 83.494 touched last month, as the euro rose 0.3% to $1.3017.
Stability in the euro zone was evident at Italy's three-year debt auction on Monday when costs fell to their lowest since January, as investors backstopped by European Central Bank guarantees, brushed off concerns about the country's political and economic troubles.
"The dollar's climb is based on the recovery scenario for the US economy, with the strong dollar denting sentiment for commodities which have been weakened by the sluggish growth in emerging countries," said Naohiro Niimura, a partner at research and consulting firm Market Risk Advisory in Tokyo.
"But the prospect for firmer US growth will raise demand for commodities and lift their prices eventually," he said, also noting the normalisation in financial markets as seen by falling yields in the peripheral euro zone countries such as Italy.
US stocks paused overnight from last week's record high closings and European shares edged off five-year highs after renewed concerns about banks sparked profit-taking in the second best-performing sector of the past month.
US retail sales unexpectedly rose in April, prompting Goldman Sachs and JPMorgan to upgrade their view on second-quarter growth and drove the benchmark 10-year Treasury yield up to a six-week high of 1.925% on Monday.
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An optimistic outlook for the US economy stirred market talk that the US Federal Reserve could scale back its aggressive bond-buying programme aimed at supporting growth, which has helped drive prices of risk assets higher.
MSCI's broadest index of Asia-Pacific shares outside Japan rose 0.3%, with Australian shares inching up 0.2% and South Korean shares climbing 1%.
"Renewed foreign investor buying, encouraged by US retail sales data, is boosting the market today," said Cho Seong-joon, a market analyst at NH Investment & Securities, of Seoul stocks.
The Nikkei stock average was up 0.2%, after rising as much as 1.7% on Monday to scale a fresh peak since January 2008 of 14,849.01.
Japanese equities have been bolstered by the weak yen trend, which accelerated after the Bank of Japan's April 4 launch of a sweeping monetary expansion campaign aimed at breaking a 15-year deflationary cycle and putting the economy on a sustainable growth path.
"The market is short of new catalysts for now as most of the corporate earnings are out. Since we have confirmed that companies' conservative earnings forecasts for this year will be revised up, the mid-term trend should be positive," said Nobuhiko Kuramochi, strategist at Mizuho Securities.
The dollar fell 0.3% against the yen to 101.56, after reaching a 4-1/2-year high of 102.15 yen on Monday. The euro was up 0.1% against the yen at 132.18 after touching its highest since January 2010 on Monday.
Commodities have been weighed down by the dollar's rise, and sent the Australian dollar down to an 11-month low of $0.9940 hit on Monday. The Aussie was up 0.2% at $0.9974.
A weaker currency supported Australian shares.
Spot gold rose 1% to a session high of $1,444.96 an ounce as a weaker dollar helped the metal snap a three-day decline.
US crude futures were up 0.3% at $95.41 a barrel and Brent was up 0.1% at $102.90.