Asian stocks rose at the start of Wednesday's trading session, benefiting from a rebound in US markets, while investors ignored the rise in oil prices despite escalating tensions in the Middle East after the Houthi group threatened to open a new front in the widening conflict.

The broader MSCI index of Asia-Pacific shares, excluding Japan, rose 1.2%, while South Korea's KOSPI jumped more than 6%. Japan's Nikkei 225 also rose 1.9%, while S&P 500 futures fell 0.1%.

Brent crude rose 0.6% to $91.55 per barrel after two oil tankers carrying Saudi crude to Asia changed course in the Red Sea on Tuesday following threats of attacks from the Iran-aligned Houthi group in Yemen.

Westpac analysts wrote in a research note: 'Stock markets ignored geopolitical risks and instead focused on the technology sector's returns. After significant losses in recent days, semiconductor stocks rebounded strongly.'

In Tuesday's trading, the S&P 500 rose 0.9%, ending a three-session losing streak, supported by a rebound in chip stocks after data showed South Korea's semiconductor exports nearly tripled in the first weeks of July, and Taiwanese export orders in June exceeded expectations.

Investors are awaiting earnings results from Alphabet, which faces increased scrutiny due to delays in launching a major model supporting its AI ambitions, as well as Tesla's results, which are widely expected to post its first quarterly cash burn in over two years amid rising spending on AI and robotics.

Investors are also watching developments in the pharmaceutical sector after US President Donald Trump announced that all generic drugs imported into the United States will be subject to a zero percent tariff for two years, starting August 1, then rising to 100% for one year, and then to 200% thereafter.

The dollar index, which measures the US currency against a basket of six major currencies, stabilized near its one-week high of 101.20 points. The dollar fell 0.1% against the yen to 163.06 yen, after hitting a four-decade high against the Japanese currency in the previous session.

The rise in oil prices, which ended Tuesday's trading at a five-week high, did not significantly impact bond and currency markets, as markets await central bank meetings next week.

A Reuters poll showed that the Federal Reserve will keep interest rates unchanged until the end of 2026, although economists see the probability of a rate hike as still high.

US interest rate futures indicated that a single rate hike by December remains the most likely scenario, while the odds of a 50 basis point or more increase by year-end are balanced.

The yield on the 10-year US Treasury note rose 0.2 basis points to 4.628%.

In metals markets, gold rose 0.5% to $4,097.67 per ounce.

In the cryptocurrency market, Bitcoin rose 0.3% to $66,611.73, while Ether climbed 0.7% to $1,936.18.