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With just two weeks left until the U.S. government runs out of money to pay bills, President Barack Obama seized on a plan by a bipartisan group of senators that could revive stalled U.S. debt talks and the prospect of a long-term deficit reduction deal to avert a default.

Hopes that policymakers in Europe may reach a deal to provide more aid for Greece at a summit this week helped the euro which also drew support from Obama's comments.

The euro was up 0.1 percent against the dollar and 0.2 percent versus the yen in early Asian trade.

Asian tech stocks, this year's worst performing regional sector, got a lift as corporate earnings from IBM and iPhone maker Apple which surpassed analyst forecasts.

Benchmarks in Japan .N225, South Korea .KS11 and Taiwan .TWII rose more than 1 percent in early trading with makers of tablet and smartphone components posting strong gains.

The MSCI Asia ex-Japan index .MIAPJ0000PUS was up 1.2 percent. Samsung Electronics (005930.KS), which plans to introduce an upgraded version of its own Galaxy tablet in the Korean markets on Wednesday, jumped 3.5 percent.

In a clear sign that risky assets were coming back in favor, gold snapped an snapped an unprecedented 11-day winning streak, shedding over 1 percent overnight. Spot gold which hit a record $1,609.51 an ounce on Tuesday was trading around $1,587.1 an ounce.

NYMEX crude oil rose above $98 a barrel as crude inventories in the U.S. tightened and industrialized nations looked unlikely to release more emergency reserves.

(Editing by Ramya Venugopal)

Sales of its iconic products far outpaced forecasts, helping drive a near-doubling of revenue in the fiscal third quarter. Its shares leapt to a high of $405 after a brief after-hours trading suspension.

Apple sold 20.34 million iPhones during the quarter versus an expected 17 million to 18 million, which analysts say helped it vault past Nokia and Samsung Electronics to become the world's biggest smartphone maker.

That "figure may indeed make them the largest smartphone maker by volume, which is somewhat ironic in a quarter that many thought would be about the Mac," said CCS Insight analyst John Jackson. "That they accomplished this without a new model speaks volumes about both their strength and the relative challenges facing competitors."

Apple's earnings beat was spectacular even by its own lofty track record. Its quarterly EPS beat the average forecast by 33 percent, versus beats of about 20 percent in the past two quarters.

The stellar results came as concern over iPad 2 supply constraints eased, with Chief Financial Officer Peter Oppenheimer saying more than 1 million iPads remained in stock at the end of June but demand was still overstripping supply in some markets.

Oppenheimer hinted at an upcoming product launch, saying it would impact the September quarter, but he gave no details.

In coming months, Apple is expected to roll out a new iPhone, which is likely to give the world's most valuable technology company another shot in the arm and offer a stiff challenge to rivals such as Google Inc and Research in Motion.

"They never cease to amaze me, these guys," YCMNET Advisors Chief Executive Michael Yoshikami said. "The numbers are obviously very strong and they seem to be accelerating earnings on all fronts."

ASIA ON FIRE

The Cupertino, California company said its fiscal third-quarter revenue climbed 82 percent to $28.57 billion, trouncing the average analyst estimate of $24.99 billion, according to Thomson Reuters I/B/E/S.

The company posted net income for the fiscal third quarter ended June 25 of $7.31 billion, or $7.79 per share, up from $3.25 billion, or $3.51 per share. Analysts on average had expected Apple to report $5.85 per share, according to Thomson Reuters I/B/E/S.

Oppenheimer attributed the big margin boost to higher sales of the iPhone, particularly in Asia. International sales accounted for 62 percent of the quarter's revenue.

Shares in Apple's Asian suppliers including Taiwan's Hon Hai Precision and Largan Precision jumped 2.6 percent and 3.2 percent respectively, while Japan's Foster Electric, which makes headphones for smartphones, rose 1.7 percent by 0015 GMT.

In Korea, top chipmaker Samsung Electronics Co rose 2.9 percent, while LG Display jumped 4.1 percent, and Hynix Semiconductor were up 2.8 percent by 0015 GMT.

"Apple is doing well, but this does not mean other tech companies are doing well. Tech shares are rising after their recent sharp falls and on expectations that their earnings may not be as bad as previously concerned," said Lee Seon-yeob, an analyst at Shinhan Investment Corp in Seoul.

Apple Chief Executive Tim Cook told analysts they were particularly optimistic about Greater China, which includes mainland China, Hong Kong and Taiwan, where Apple's year-over-year revenue was up sixfold at $3.8 billion. Overall, Asia Pacific revenue more than tripled to $6.3 billion in the quarter.

"I firmly believe that we are just scratching the surface right now," Cook said of China. "I think there is an incredible opportunity for Apple there."

Cooks also remarked on Apple TV, one of the few Apple products that has not really connected with consumers, saying it still had a "hobby status" within the company.

Apple sold 9.25 million iPads and 3.95 million Mac computers. Gross margin for the quarter came to 41.7 percent.

Shares of Apple have emerged from the limbo they had fallen into after Chief Executive Steve Jobs took leave last January for unspecified medical reasons.

Based on a price of $400, Apple would have a market capitalization of $369.90 billion, putting it close to Exxon Mobil, the largest company in the Standard & Poor's 500 index, which has a $411.97 billion market value.

The stock has gained 16.8 percent so far this year and has had only two "down" years in the last 10: in 2002, when it lost 35 percent, and in 2008, when it dropped 57 percent.

On Tuesday, Jobs' health again came to the forefront after the Wall Street Journal reported that several Apple board members had discussed a successor to the Silicon Valley icon, and talked it over with at least one head of a high-profile tech company.

Succession planning at Apple has been a hot topic since Jobs announced his medical leave, with many not expecting him to return to lead the company he founded in 1976.

The fate of Apple is tied to how the iPhone and iPad maker handles the eventual departure of its iconic chief. Chief Operating Officer Tim Cook is overseeing day-to-day operations.

Shareholders representing almost a third of Apple's stock voted in February in favor of a proposal to disclose a succession plan for Jobs, underscoring worries over who will replace the visionary leader at the helm.

Apple, notorious for its conservative forecasts, estimated earnings for the September quarter of $5.50 a share on revenue of $25 billion, below analysts' average estimate of $6.45 a share on revenue of $27.7 billion.

(Additional reporting by Hyunjoo Jin in SEOUL; Writing by Edwin Chan in Los Angeles; Editing by Richard Chang and Anshuman Daga)

Its flagship products all exceeded forecasts. It sold 20.34 million iPhones during the quarter along with 9.25 million iPads and 3.95 million Mac computers. Gross margin for the quarter came to 41.7 percent.

The stellar results came as concern over iPad 2 supply constraints eased. The company is entering the second half of 2011 on a roll. In coming months, Apple is expected to launch a new iPhone, which is likely to give the world's most valuable technology company another revenue boost.

Apple, notorious for its conservative forecasts, estimated earnings for the September quarter of $5.50 a share on revenue of $25 billion, which came in below analysts' average estimate of $6.45 a share on revenue of $27.7 billion.

The Cupertino, California company said on Tuesday its fiscal third-quarter revenue rose to $28.57 billion, trouncing the average analyst estimate of $24.99 billion, according to Thomson Reuters I/B/E/S.

Shares of the world's most valuable technology company leapt 6.1 percent to about $400 after a brief halt after-hours. They had fallen into a limbo after Chief Executive Steve Jobs took leave last January for unspecified medical reasons.

The stock price has gained nearly 19 percent since hitting a year low on June 20. The rally has added $54.8 billion to Apple's market cap since then.

On Tuesday, Jobs' health again came to the forefront after the Wall Street Journal reported that several Apple board members had discussed a successor to the Silicon Valley icon, and talked it over with at least one head of a high-profile tech company.

Succession planning at the world's most valuable technology company has been a hot topic since Jobs announced he was taking medical leave for unknown reasons, with many not expecting him to return to lead the company he founded in 1976.

The fate of Apple is tied to how the iPhone and iPad maker handles the eventual departure of its iconic chief. Chief Operating Officer Tim Cook is overseeing day-to-day operations at the company.

Shareholders representing almost a third of Apple's stock voted in February in favor of a proposal to disclose a succession plan for Jobs, underscoring worries over who will replace the visionary leader.

(Additional reporting by Edwin Chan in Los Angeles; Editing by Richard Chang)

The biggest U.S. investment bank by assets reported earnings of $1.05 billion, or $1.85 per share. Analysts on average expected $2.27 per share, according to Thomson Reuters

I/B/E/S.

A year earlier, adjusted for special charges, Goldman earned $2.75 per share.

Trading in fixed income, currency and commodities dropped far more than analysts expected, hurt by slowing market activity because of weak economic growth and regulatory uncertainty.

Revenue in that division declined a bigger-than-expected 53 percent to $1.6 billion. It was the sixth consecutive quarter of FICC trading declines.

Overall revenue declined 17.6 percent to $7.3 billion, well short of analysts' average forecast of $8.1 billion.

Operating expenses were down 23.3 percent.

Goldman Chief Executive Lloyd Blankfein called the results in some of the bank's divisions "disappointing." In a statement, he added, "The operating environment was more difficult given global macro-economic concerns."

Goldman shares fell 3 percent to $125.40 in premarket trading.

(Reporting by Lauren Tara LaCapra, editing by Knut Engelmann and John Wallace)

The largest U.S. bank by assets on Tuesday reported a net loss of $8.8 billion, or 90 cents per share, compared with net income of $3.1 billion, or 27 cents per share, a year earlier.

Analysts on average expected a loss of 90 cents per share, according to Thomson Reuters I/B/E/S.

On June 29, the bank announced it would take a series of big one-time charges in the quarter related to a settlement with private investors who demanded the bank repurchase toxic home loans held in mortgage-backed securities.

Excluding the charges, the bank reported net income of $3.7 billion, or 33 cents per share, for the second quarter.

Revenue tumbled 54 percent to $13.5 billion, due to a $14 billion provision taken as part of the mortgage settlement. Excluding that provision, revenue totaled $26.5 billion.

BofA shares fell 2.8 percent to $9.72 on Monday and have declined 27 percent this year, compared with a 12 percent drop in the KBW Banks Index.

(Reporting by Joe Rauch; editing by John Wallace)

IBM (IBM.N) will be in the spotlight after the company said signings of new business at its services division surged 16 percent in the second quarter, trouncing expectations and raising hopes that 2011 will be a good year for the technology sector. IBM shares traded in Frankfurt (IBM.F) were up 1.3 percent.

Cisco Systems (CSCO.O) plans to cut 15 percent of its staff and sell a set-top box factory as part of a plan to cut annual expenses by $1 billion as the network equipment maker tries to revive its fortunes.

Investors awaited results from a flurry of companies on Tuesday, including Bank of America Corp (BAC.N), Goldman Sachs (GS.N), Johnson & Johnson (JNJ.N), Coca Cola (KO.N), Wells Fargo (WFC.N) and Apple (AAPL.O).

On the macro side, investors braced for data on housing starts and building permits, due at 1230 GMT. Economists in a Reuters survey forecast a 575,000 annualized rate in June versus 560,000 in May, and a total of 600,000 permits in June compared with 609,000 in the prior month.

European stocks were up 0.8 percent in morning trade, halting a sharp two-week retreat, led by tech shares after IBM's strong results.

Two weeks before their final deadline, President Barack Obama and top lawmakers will face more pressure on Tuesday for a debt deal amid a growing sense that a last-ditch plan taking shape in Congress may be the only way to avoid a devastating U.S. default.

U.S. stocks dropped on Monday as bank shares bore the brunt of investor frustration over governments' inability to solve debt crises in the United States and Europe.

The Dow Jones industrial average .DJI dropped 94.57 points, or 0.76 percent, to 12,385.16. The Standard & Poor's 500 Index .SPX declined 10.70 points, or 0.81 percent, to 1,305.44. The Nasdaq Composite Index .IXIC fell 24.69 points, or 0.89 percent, to 2,765.11.

(Reporting by Blaise Robinson; Editing by Hans-Juergen Peters)