- Asia markets were mixed by late-afternoon trading after U.S. stocks declined on Friday
- A report that Michael Flynn, the former White House national security advisor, was directed by then-candidate Donald Trump to talk to Russia spooked Wall Street. That report has since been corrected to say Trump made the request when he was already president-elect
- Separately, Senate Republicans were able to narrowly pass a bill to overhaul the U.S. tax system in the early hours of Saturday morning
- Dow Jones industrial average e-mini futures rose 203 points to 22,441, while the Nasdaq and S&P 500 e-mini futures were also higher
Asia markets traded mixed on Monday, while U.S. futures rose, as investors digested news that the U.S. Senate narrowly passed an important tax bill in the early hours of Saturday.
e-mini futures were up 203 points at 22,441 at 2:26 p.m. HK/SIN. Earlier, Dow futures rose as high as 24,478. Nasdaq e-mini futures were up 28.75 points and the S&P 500 e-mini futures rose 14.25 points.
In Australia, the ASX 200 closed fractionally lower at 5,985.6 as the heavily-weighted financial subindex fell 0.62 percent. The country's so-called Big Four banks closed lower.
Japan's declined by 111.87 points, or 0.49 percent, to 22,707.16 while the Topix index fell 9.66 points, or 0.54 percent, to 1,786.87.
Across the Korean Strait, the Kospi stood out from its peers, closing up 26.26 points, or 1.06 percent, at 2,501.67.
Chinese mainland markets see-sawed between gains and losses throughout the session. In the afternoon, the closed down 7.24 points, or 0.22 percent, at 3,310.36 while the Shenzhen composite fell 13.89 points, or 0.72 percent, to 1,902.91.
In Hong Kong, the reversed early losses of near 0.3 percent to climb 0.6 percent at 3:11 p.m. HK/SIN. Elsewhere, major indexes in Indonesia and India also rose in afternoon trade.
In the early hours of Saturday morning, Senate Republicans narrowly passed a bill to overhaul the U.S. tax system. The GOP still needs to overcome significant disagreements for the House and Senate to craft a joint bill and send it to Trump's desk. Republicans hope to reach a deal by Christmas.
While the tax bill narrowly passing may have been a "political relief" for the Trump administration, it does not "eradicate fiscal uncertainty," according to Vishnu Varathan from Mizuho Bank.
"Fact is, a possible U.S. government shutdown looms heading into 8th Dec and, in all likelihood, the backstop to avert a shutdown may be by the skin of the teeth as well," he wrote in a Monday morning note. "And this could keep long-end yield upside in check if caution trumps exuberance."
The trading week in Asia began following a decline in U.S. stocks on Friday after a shock from a since-corrected report about the investigation into possible collusion between then-candidate Donald Trump and Russia.
ABC News reported on Friday that Michael Flynn, the former White House national security advisor, would testify that he was directed to make contact with Russians during the presidential campaign in 2016.
That report hit the markets hard, but ABC later corrected the story to say its source had clarified that Trump gave Flynn the directive "shortly after the election" to discuss strategies for fighting the Islamic State extremist group.
Flynn, on Friday, pleaded guilty to lying to the FBI about his post-election contacts with Russia's ambassador to the U.S. In a statement issued by his lawyers on the same day, Flynn said he had agreed to cooperate with special counsel Robert Mueller's investigators.
That news "provides a reminder of the cloud hanging over the Trump administration," Shane Oliver, head of investment strategy and chief economist at AMP Capital, wrote in a weekend note. He added that could cause "bouts of volatility next year and just adds to the likelihood that the GOP will lose control of the House in the November 2018 mid-term elections."
"However, we remain of the view that it does not change prospects for tax reform (it's already nearly there) and in fact just highlights the pressure on Congress to get it done," Oliver noted.
In the currency market, the dollar rose from an overnight low of 92.881 to trade at 93.172 against a basket of currencies at 2:31 p.m. HK/SIN.
"This morning, optimism arising from the Senate approval of its version of the tax reform package supported the broad dollar complex," analysts at Singapore's OCBC Bank wrote in a morning note. They added that "investor sentiment over the eventual vote appears to be positive, though the process of resolving the House and Senate versions of the tax bill is not expected to be straightforward."
The analysts cautioned that headlines "on this front" could "impart some near-term gyrations" in the dollar index.
Among other currency majors, the Japanese yen fetched 112.87 to the dollar, weakening from an earlier low of 112.39. Despite the relative weakness in the yen, some of the major exporters remained under pressure: Toyota closed down 0.61 percent, Sony reversed early losses to finish up 1.44 percent and Mitsubishi Electric was down 0.78 percent. Nissan shares rose 0.18 percent.
Typically, a weaker yen is a positive for Japanese exporters since it increases their overseas revenue when converted back into local currency.
In company news, Hong Kong-listed shares of Wanda Hotel Development rose 11.19 percent in afternoon trade.
In a regulatory filing, the company said 65.04 percent of all of its issued shares will be transferred to a new holding company — Wanda Investment Holding — that will be wholly-owned by billionaire founder Wang Jianlin. The shares will be transferred at HK$1.20 ($0.15) a share as part of the company's proposed reorganization.
— CNBC's Fred Imbert and Jacob Pramuk contributed to this report.