"I think markets are going to be more volatile for the next 12-18 months as the Fed prepares markets for the exit. The question is, can they manage equity markets where they are and keep the economy going?" said Kumar Palghat, managing director at Kapstream Capital.
Bernanke heads back to Capitol Hill on Thursday to testify before the Senate Banking Committee.
Nikkei rallies 1.%
The Japanese yen weakened to 100 per dollar, propping up exporter stocks and leading the index to its highest levels since May 24. Sharp jumped nearly 4 percent while telco carrier Softbank also rose 4 percent on news of a joint venture project with U.S. firm Bloom Energy tosupply green energy to Japanese corporations.
Still, the index is down 7 percent since hitting a five-and-a-half-year peak of 15,942 in May.
(Watch now: Too much enthusiasm for Japan markets: Pro)
A Reuters survey of sentiment among Japanese manufactures eased in July for the first time in eight months over worries of a slowdown in China. The data marks a big step down from a two-year high in June and highlights complaints that the effects of Prime Minister Shinzo Abe's stimulus policies have yet tobe seen.
Shanghai 1% lower
Mainland property stocks were in focus for China's benchmark stock index after data showed average new home prices for the month of June jumped 6.8 percent year-on-year, higher than a forecast by analysts polled by Reuters for a 6 percent gain.
Developers slumped in reaction as investors worried about more property curbs to tame price rises, helping push the Shanghai Composite to its lowest level in a week. Gemdale led declines by 3 percent while both Vanke and China Merchants Property eased over 2 percent each.
(Read more: The long game: Why a China slowdown isn't scary)