Asian shares rise amid optimism about Hong Kong, Brexit

Asian shares were mostly higher Thursday amid encouraging global developments, including British lawmakers seeking a less chaotic exit from the European Union and easing political tensions in Hong Kong.

Japan's benchmark Nikkei 225 rose 2.3 percent to 21,131.08 in morning trading. Australia's S&P/ASX 200 added 1 percent to 6,618.40, while South Korea's Kospi gained 1.2 percent to 2,013.04. Hong Kong's Hang Seng was up nearly 0.4 percent at 26,620.94, while the Shanghai Composite rose 1.6 percent to 3,004.54.

Shares rallied on Wall Street, reversing Tuesday's losses, when disappointing U.S. manufacturing data and an escalation in the ongoing trade war between the U.S. and China led to a sell-off that ended a three-day winning streak for the market.

The S&P 500 gained 31.51 points, or 1.1 percent, to 2,937.78. The Dow Jones Industrial Average 237.45 points, or 0.9 percent, to 26,355.47. The Nasdaq, which is heavily weighted with technology stocks, climbed 102.72 points, or 1.3 percent, to 7,976.88. The Russell 2000 index of smaller company stocks picked up 12.47 points, or 0.8 percent, to 1,484.76.

Investors have been worried that the trade war and a slowing global economy could tip the U.S. into a recession. But traders set aside those concerns Wednesday, focusing instead on geopolitical developments.

In Hong Kong, the government withdrew an extradition bill that had set off three months of protests.

In Europe, Britain's parliament took a big step toward passing a law that could stop Prime Minister Boris Johnson's plan to pull out of the EU on Oct. 31 with or without a withdrawal agreement.

Leaving the EU without a deal that covers trade and other issues could result in economic chaos for Britain and complicate trade with member nations in the EU.