Stocks in Asia Pacific were mostly higher on Wednesday after the U.S. Federal Reserve announced an emergency rate cut on Tuesday.
South Korea's Kospi led gains among major Asian markets as it jumped 2.24% to close at 2,059.33. The moves came as the country proposed an extra budget of 11.7 trillion Korean won ($9.86 billion) to combat the coronavirus outbreak and its economic impact, according to a report by Yonhap.
South Korea has more than 5,300 total confirmed cases so far, according to the Korea Centers for Disease Control and Prevention, making it the country with the highest number of infected outside of China.
Mainland Chinese stocks were higher on the day. The Shanghai composite added 0.63% to about 3,011.67 while the Shenzhen component was fractionally higher at 11,493.02. The Shenzhen composite gained 0.361% to approximately 1,895.74.
A private survey released Wednesday showed China's services sector seeing its worst month on record in February, according to Reuters. The Caixin/Markit services Purchasing Managers' Index (PMI) plunged to 26.5 from 51.8 in January. The 50-point level in PMI readings separates growth from contraction.
Hong Kong's Hang Seng index edged 0.22% higher, as of its final hour of trading. That came after the latest release of IHS Markit's Hong Kong Purchasing Manager's Index, which hit a record low of 33.1 in February.
In Japan, the Nikkei 225Â closed fractionally higher at 21,100.06 while the Topix index ended its trading day 0.17% lower at 1,502.50. The Japanese yen, often seen as a save-haven in times of economic uncertainty, traded at 107.55 per dollar after touching an earlier high of 106.84.
Meanwhile, stocks in Australia declined, with the S&P/ASX 200Â closing 1.71% lower at 6,325.40.
Overall, the MSCI Asia ex-Japan index was 0.43% higher.
Australia's better-than-expected fourth quarter GDP
Australia's GDP for the fourth quarter rose above expectations, growing a seasonally adjusted 0.5% during the fourth quarter, according to data from the Australian Bureau of Statistics. That was higher than the forecast of a 0.3% growth in a Reuters poll.
Following the data release, the Australian dollar jumped to $0.6599 after an earlier low of $0.6574.
"I am breathing a bit of a sigh of relief because we have a expectation March quarter growth will be negative so I was worried that, you know, if this came in at zero or even slightly negative then we might be ... in a technical recession," said Diana Mousina, senior economist at AMP Capital.
"I think though the fourth quarter data is a little bit redundant now, it's good to see that consumption expenditure was a little bit stronger ... in the December quarter but we kind of knew that already from the retail sales print," Mousina told CNBC's "Squawk Box" on Wednesday. "What's more important now is what happens to (Australia's) education, tourism sectors because of the coronavirus."
The Reserve Bank of Australia cut its cash rate to a new record low on Tuesday. The central bank's Governor Philip Lowe said in a statement announcing the monetary policy decision that the "coronavirus outbreak overseas is having a significant effect on the Australian economy at present, particularly in the education and travel sectors."
Overnight stateside, the Dow Jones Industrial Average closed 785.91 points lower at 25,917.41. The S&P 500 fell 2.8% to end its trading day at 3,003.37 while the Nasdaq Composite pulled back 3% to close at 8,684.09.
Meanwhile, the yield on the benchmark 10 year U.S. Treasury note fell below 1% for the first time ever, while gold prices jumped 2.9% to settle at $1,644.40 per ounce. The 10-year yield was last at 0.9715% while spot gold traded at $1,634.75 per ounce.
Oil prices were higher in the afternoon of Asian trading hours, with international benchmark Brent crude futures up 0.96% to $52.36 per barrel. U.S. crude futures also added 1.12% to $47.71 per barrel.
Central bank watch
The moves came following a surprise decision by the Fed to cut rates by half a percentage point two weeks ahead of its scheduled meeting, the "evolving risks to economic activity" posed by the coronavirus. It was the central bank's first such emergency action coming in between scheduled meetings since the 2008 financial crisis.
The U.S. dollar index, which tracks the greenback against a basket of its peers, was last at 97.282 after seeing declines from levels above 97.6 yesterday.
Central bank rate cuts won't fix fear of catching the virus.Joseph CapursoSenior currency strategist, Commonwealth Bank of Australia
"The economic problem is fear of catching the virus," Joseph Capurso, senior currency strategist at Commonwealth Bank of Australia, wrote in a morning note.
Capurso said "fear hurts the economy" as people stop activities such as going to work, and shopping.
"Central bank rate cuts won't fix fear of catching the virus. Economies around the world will be disrupted from fear. That is why we suggest monitoring high frequency economic indicators for a turning point. Financial markets are likely too optimistic about the global economic outlook," he said.
Following the Fed cut, the Hong Kong Monetary Authority announced Wednesday it cut its base rate by 50 basis points to 1.5%.
The coronavirus outbreak, which has spread quickly outside of China — where it was first reported — in recent days, has weighed heavily on investor sentiment. More than 91,700 have been infected by the disease globally while at least 3,100 lives have been taken so far, according to the latest figures from the World Health Organization.
— CNBC's Fred Imbert and Christine Wang contributed to this report.
Correction: This report was updated to reflect that gold prices jumped 2.9% to settle at $1,644.40 per ounce on Tuesday stateside.