Asian shares, the euro and the Australian dollar inched up on Tuesday after a surprising expansion in U.S. factory activity, and although weak global growth remains a key concern, some market players said risk assets should continue to find support.

Markets in China, Hong Kong and India are closed for holidays on Tuesday.

The MSCI index of Asia-Pacific shares outside Japan <.MIAPJ0000PUS> rose 0.3 percent, with Australian shares <.AXJO> up 0.6 percent while South Korean shares <.KS11> edged 0.3 percent higher.

Japan's Nikkei stock average <.N225> was up 0.2 percent, recovering from a three-week low hit on Monday. <.T>

Wall Street stocks ended higher after closing out their best third quarter since 2010, as data showed U.S. manufacturing grew last month for the first time since May. The Standard & Poor's 500 Index <.SPX> hovered at levels not far from its loftiest close since December 2007 hit last month.

"Although the markets seem anemic due to the negative information in the markets against a backdrop of uncertainly from Europe, we do see a potential uptrend and hope the worst is now behind us," said Mikayel Verdyan, an analyst at online broker Forex Club.

Europe's debt crisis will remain investors' focus for some time, but attention will gradually shift to the November 6 U.S. presidential elections and quarterly U.S. earnings, he said, adding that markets may rally two weeks before the U.S. election, although the S&P 500 will be capped around 1,520.

"With a gradual rise in the stock markets, we would expect to see the financial sector benefit from this as it appears fairly oversold at present," he said.

Euro zone factories suffered their worst quarter since early 2009 and China lost steam, suggesting the global economy faces hurdles as it tries to outrun recession.

U.S. Federal Reserve Chairman Ben Bernanke said the U.S. central bank did not foresee a recession but growth was too slow to bring down the nation's jobless rate.

U.S. jobs data due on Friday will offer the first glimpse into the state of the U.S. economy after the Fed embarked on new stimulus last month.

Barclays Capital said despite recent weak data on global manufacturing, the environment for riskier assets remains supportive as investors have been reassured by policy steps in Europe and the United States.

"Expectations for the recovery have been ratcheted down enough to mitigate the risk of disappointed and anxious reactions," it said in a research note.

The euro was up 0.1 percent to $1.2902, moving away from a three-week low of $1.28035 touched on Monday, but was vulnerable as investors waited for Spain to seek a sovereign bailout and remained wary of a possible Moody's credit rating cut of Spain to junk status.

The Australian dollar also edged 0.1 percent higher, to $1.0371, ahead of the Reserve Bank of Australia's policy decision due at 0430 GMT. Markets have priced in a 62 percent chance of a quarter-point cut in the 3.5 percent cash rate.

"The RBA meeting presents quite a risk to short AUD positions, should they decide to keep rates unchanged," said Mary Nicola, a strategist at BNP Paribas, adding that the RBA was expected to stand pat and then cut in November.

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Markit PMI: US, Europe, China: http://link.reuters.com/rej92t

Euro zone unemployment rate: http://link.reuters.com/kes74s

Interactive crisis timeline http://link.reuters.com/wub88s

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EVENTS AHEAD

The RBA kicks off a week of central bank policy decisions, with the European Central Bank, the Bank of England and the Bank of Japan following later this week.

Other key events include the Eurogroup meeting next Monday.

Greece unveiled on Monday a harsher austerity budget for 2013 which aims to pave the way for an international aid crucial to keep the country afloat as its finance minister met global lenders, who still object to some of the measures.

Spain is ready to request a euro zone bailout for its public finances as early as next weekend but Germany has signaled that it should hold off, European officials said on Monday. Spain has announced severe 2013 budget and economic reforms and the result of stress tests on its banks, moves seen to clear the way for such aid.

"We still like longs in peripheral risk over a one to two-month holding period ... We prefer to put longs back on any substantial weakness, such as a Moody's downgrade of Spain," Societe Generale said in a research note on bonds.

Spot gold rose 0.2 percent to $1,777.32 an ounce, after marking a high of $1,791.20 on Monday, its strongest level since mid-November on fund buying and possible central bank demand.

U.S. crude inched down 0.1 percent to $92.38 a barrel and Brent was little changed at $112.19. London copper eased 0.2 percent to $8,283.75 a metric ton (1.1023 tons).

(Additional reporting by Ian Chua in Sydney; Editing by Edwina Gibbs)