U.S. dollar and Asia stocks rise

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Recent reports showing shrinking or no economic growth in Britain, the euro zone and Japan have boosted the attraction of the dollar as an alternative investment, especially with crude prices trading just above $114 barrel, $33 below a record high hit in July.

A rally in the dollar stalled last week after hitting a six-month high against the euro, but an upward trend in the U.S. currency is seen intact.

Even billionaire investor and long-time dollar detractor Warren Buffett, chairman of conglomerate Berkshire Hathaway Inc, came to the currency's aid on Friday when he said in a television interview that he had no bets against the dollar.

"The combination of incremental weakness in the European economy and the lower oil prices should keep the pressure on euro/dollar in our view," Nizram Idris, currency strategist with UBS in Singapore, said in a note.

Asian stocks rebounded from a two-year low as the drop in oil prices lifted shares of companies sensitive to energy prices, though trading volumes across the region were quite thin, suggesting a lack of conviction among investors.

Japan's Nikkei share average .N225 jumped about 1.9 percent, with shares of Honda Motor Co leading the way higher.

The MSCI pan-Asia stocks index was up 1.6 percent, after hitting the lowest since July 2006 on Friday. The MSCI Asia-Pacific ex-Japan index rose 1.2 percent. Australia's benchmark share index was also up 2 percent, helped by rallying shares of the country's top banks.

Hong Kong's Hang Seng index led the region, up 3 percent after plumbing a one-year low on Friday. Shares of offshore Chinese oil producer CNOOC were up 3.7 percent and among the biggest boosts to the index, with the company expected to report solid first-half results on Wednesday.

RISK PROFILE

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