Asia markets were lower on Thursday, with investors grappling with rising rates after strong U.S. economic data was released overnight.
The slid by 0.56 percent to close at 23,975.62, while the Topix index ended the trading day slightly weaker at 1,801.19.
The Kospi continued to slide, by 1.52 percent, to close at 2,274.49, following news reports that Bank of Korea Governor Lee Ju-yeol hinted at a possible policy rate hike later in October.
Stocks of South Korea's cosmetics brands took a hit on the back of weak sentiment about Chinese consumers, according to Reuters. Amorepacific shares dropped by 13.04 percent in the afternoon, while Cosmax fell 9.91 percent.
Hong Kong's Hang Seng index also lost 1.77 percent in the afternoon.
Down Under, however, the ASX 200 rose 0.49 percent, with the heavily weighted financial sector up 0.8 percent as Commonwealth Bank of Australia advanced by 0.45 percent and Australia and New Zealand Banking Group climbed up by 0.62 percent. Miner South32 also saw its stock jumping by 7.32 percent on the back of South Africa's Exxaro expressing interest in its local coal assets.
Data had shown the country's trade surplus increasing for the month of August — above expectations from a Reuters poll. Net exports rose 1 percent month-on-month while imports were unchanged.
China's markets are closed for the Golden Week holidays.
Toyota and Softbank announce new joint venture
On Thursday, Toyota and Softbank announced that they were forming a joint venture called Monet Technologies. The company is expected to be formed by 2019 and will use data to optimize supply and demand in the transportation industry.
Following the announcement, shares of Toyota closed up by 0.59 percent, Softbank's stock rose by 1.31 percent.
Rising rates on back of strong US economic data
On Wall Street, the Dow Jones Industrial Average gained 54.45 points to close at 26,828.39. The index hit an all-time intraday high earlier in the trading day at 26,951.81. Meanwhile, the closed largely flat at 2,925.51 while the Nasdaq Composite climbed 0.32 percent to end the trading day at approximately 8,025.09.
On Wednesday, Federal Reserve Chairman Jerome Powell said the U.S. central bank was "a long way" from neutral on interest rates, and has a ways to go yet before it gets interest rates to where they are neither restrictive nor accommodative.
The benchmark 10-year note yield traded near 3.14 percent, hitting its highest level since 2011. The 30-year bond yield, meanwhile, reached its highest level since October 2014. Rates were boosted by the release of stronger-than-expected economic data.
Also on Wednesday, a report from ADP and Moody's Analytics showed private payrolls in the U.S. increasing by 230,000 in September — the highest in seven months. This was compared to a number of 185,000 jobs expected by economists polled by Refinitiv (formerly Thomson Reuters). The report is often seen as a preview to the government's nonfarm payrolls report, which is set for release on Friday.
Currencies and oil
The U.S. dollar index, which tracks the greenback against a basket of peers, was at 95.979 as of 2:47 p.m. HK/SIN, easing from its earlier high after an overnight rally.
The largely held on to gains, at 114.31 against the dollar, while the remained weaker at $0.7087.
In oil markets, prices fell once again in the afternoon of Asian trade after seeing a partial recovery earlier. As of 2:50 p.m. HK/SIN, the global benchmark Brent crude futures contract dropped 0.31 percent to $86.02 per barrel, while the U.S. crude futures contract traded down 0.3 percent at $76.18 per barrel.
— CNBC's Fred Imbert, Jeff Cox and Reuters contributed to this report.