Asia stocks start data-heavy week with gains; dollar creeps up

Asian shares turned positive on Monday, shrugging off a new North Korean missile test as investors turned their attention to a raft of global economic data and earnings this week, while the dollar crept up but remained capped by U.S. political concerns. 

European stocks look set for a muted start, with financial spreadbetter CMC Markets expecting Britain's FTSE 100 .FTSE, Germany's DAX .GDAXI and France's CAC 40 .FCHI to all open little changed. 

MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS reversed early losses to rise 0.25 percent. 

Chinese shares rose, buoyed by several leading companies' forecasts for strong mid-year earnings. The blue-chip index .CSI300 and the Shanghai Composite .SSEC both rose 0.6 percent. Hong Kong's Hang Seng .HSI climbed 1 percent to a two-year high. 

That strong performance came despite a slip in official Chinese manufacturing and services purchasing managers' indices in July, although they stayed above the 50-point mark that separates growth from contraction on a monthly basis. 

Investors remained wary after North Korea conducted a missile test late on Friday that it said proved its ability to strike the U.S. mainland. The U.S. responded by flying two bombers over the Korean peninsula on Sunday. 

But early jitters dissipated somewhat, with the Korean won KRW= reversing losses. The dollar was down 0.2 percent at 1,120.7 won, after jumping almost 0.7 percent on Friday. South Korea's KOSPI .KS11 fell 0.2 percent.

The perceived safe-haven Japanese yen strengthened, with the dollar shedding 0.15 percent to 110.545 yen JPY=, touching its weakest since mid-June.

Japan's Nikkei .N225 was flat, with the firm yen offsetting news the country's industrial output rebounded in June from a decline in May. Australian shares advanced 0.7 percent.