Japan Stocks At 15-Year Peak, Oil Down As Saudi Ends Yemen Air Campaign

(Reuters) - Japanese shares rallied to a 15-year high on Wednesday on expectations of improved corporate earnings, while oil sagged after Saudi Arabia ended its military campaign in Yemen, easing tensions in the energy-rich Middle East.

Japan's Nikkei rose 1.1 percent to a high not seen since April 2000, with foreign investors buying on hopes of a strengthening recovery in the world's third-biggest economy and growth in corporate earnings.

In a mixed session for the region South Korea's Kospi gained 0.5 percent and Chinese and Hong Kong shares also rose. Australian, Malaysian and Indonesian stocks fell.

MSCI's broadest index of Asia-Pacific shares outside Japan stood flat.

Asian equities have found support from Chinese measures to spur lending and combat a slowing economy. On Sunday, China's central bank cut the reserve requirement ratio for the country's lenders in the second reduction in two months.

"The last few weeks have seen a flurry of measures on the regulatory, economic, and political front in China. Even though not all news was bullish for equities, we view these developments as favorable for China in the medium-term," Brown Brothers Harriman said in note to clients.

U.S. stocks were mixed overnight, with the Dow slipping on uninspiring earnings reports while the Nasdaq closed near a record high following a proposed biotech merger.

In currencies, the euro was little changed at $1.0720 after a choppy session overnight that took it between $1.0660 and $1.0782.

The common currency had been buffeted this week by worries cash-strapped Greece may default on its debt. The euro found some respite after euro zone finance ministers moved away from fixing a deadline for Athens to come up with fiscal reforms.

Greek Finance Minister Yanis Varoufakis cited signs of convergence on Tuesday between Greece and its lenders to help the euro, although the market remained cautious.

"The chance that any meaningful progress will be made is still extremely slim especially since the Germans refuse to release additional bailout funds without a credible reform plan from Greece," Kathy Lien, Managing Director of FX Strategy for BK Asset Management, said in a note.

The dollar was steady at 119.70 yen after gaining 0.4 percent overnight.

The Australian dollar rose 0.6 percent to $0.7758 after three straight days of losses as key measures of inflation were slightly higher than forecast and cooled expectations of the Reserve Bank of Australia cutting interest rates in May.

In commodities, crude oil extended losses after Saudi Arabia's announcement that it would end its three-week operation against Iran-allied Houthi rebels in Yemen eased tensions in the Middle East.

Brent crude was down 0.7 percent at $61.65 a barrel after tumbling more than 2 percent overnight.