Shares in the Asia-Pacific were mixed on Tuesday after sharp falls to start the week following Fed Chair Jerome Powell's hawkish speech in Jackson Hole.
Japan's Nikkei 225 rose 1.14% to end the session at 28,195.58, and the Topix index gained 1.25% to 1,968.38.
Hong Kong's Hang Seng index declined 0.42% in the final hour of trade, with the Hang Seng Tech Index trading 0.7% lower, while mainland China markets slipped. The Shanghai Composite fell 0.42% to 3,227.22, and the Shenzhen Component shed 0.39% to 11,970.79.
MSCI's broadest index of Asia-Pacific shares outside Japan was 0.5% higher.
Overnight in the U.S., the S&P 500 shed 0.67% to 4,030.61, and the Nasdaq Composite lost 1.02% to 12,017.67.
The Dow Industrial Average dipped 184.41 points, or 0.57%, to 32,098.99. The Dow fell more than 300 points earlier in the session and briefly rose at one point. U.S. futures inched upward following a second-straight decline for the major averages.
"It seems investors are still digesting the consequences from Fed Chair [Powell's] hawkish speech where he not only refuted the notion of a dovish pivot but emphasized the need for rates to head higher and remain restrictive in order to bring inflation to heel," Rodrigo Catril, a strategist at National Australia Bank, wrote in Tuesday note.
The U.S. dollar could strengthen further, UOB says
The U.S. dollar and bond yields are poised to rise further as interest rates rise, said Anthony Raza, head of multi-asset strategy at UOB Asset Management.
"We think there's still a lot of upward opportunity in the DXY," he told CNBC's "Squawk Box Asia" referring to the dollar index. "And we think that bond yields generally will be having some sort of gravity upwards as I think the market really gets locked into a Fed funds rate path that is going to be upward."
The U.S. dollar has strengthened against a basket of six peers this year, and last traded at 108.515.
That will increase pressure on other countries, but the economy and markets appear to have adjusted to a strong greenback and higher yields. "We're not necessarily overly bearish about it," Raza said.
— Abigail Ng
China's stimulus measures encouraging despite weak consumer confidence: JPMorgan
Recent stimulus measures introduced by the Chinese government are a good sign, but consumer confidence remains weak, said Marcella Chow, a global market strategist at JPMorgan Asset Management.
"We are encouraged by recent stimulus measures," she said, adding that she will pay attention to purchasing managers' index readings due this week and whether additional measures are passed at its next parliamentary session.
"What we are looking for is consumer confidence and also consumer conviction, as well as investor conviction [to come] back into the market," she told CNBC's "Street Signs Asia."
Chow also said she remains constructive on China in the long term because valuations are low and structural themes remain strong in the long run.
— Abigail Ng
The U.S. needs a 'miracle' if it is to avoid a recession: Stephen Roach
The U.S. will be going into a recession unless a "miracle" happens, said Stephen Roach, who was formerly chair of Morgan Stanley Asia.
"We'll definitely have a recession as the lagged impacts of this major monetary tightening start to kick in," he told CNBC's "Fast Money" on Monday. "They haven't kicked in at all right now."
"The unemployment rate has got to go probably above 5%, hopefully not a whole lot higher than that. But it could go to 6%," Roach added.
— Jihye Lee, Stephanie Landsman
Japan's July jobless rate flat, economist says improvement could be stalled
Japan's jobless rate was unchanged at 2.6% in July, in line with expectations and flat for the third consecutive month, according to official data.
Economist Marcel Thieliant at Capital Economics told CNBC's "Squawk Box Asia" that the country has a huge shortfall in face-to-face services employment compared to pre-Covid levels.
He added data suggests consumption has been affected, pointing to the recent spike in virus cases in the nation.
"That would result in the stalling of the improvement in the labor market and today's stagnation in the in the unemployment rates is consistent with that," he said.
— Abigail Ng
CNBC Pro: Strategist reveals why this FAANG stock is a safe bet heading into September
A "seasonally weak" period for equities is just around the corner, and that could mean more volatility for stock markets.
But King Lip, chief strategist at BakerAvenue Wealth Management, believes one FAANG stock could be a safe bet.
Pro subscribers can read the story here.
— Zavier Ong
Honda, LG Energy Solution stocks rise after EV battery plant announcement
Shares of Honda Motor and LG Energy Solution rose at the open following an announcement that the two companies plan to build a $4.4 billion battery plant in the U.S.
Honda Motors traded 1.7% higher in Tokyo and LG Energy Solution rose 3.4% in Seoul in Tuesday's morning session.
A slew of companies, including Panasonic and Stellantis, have recently announced plans to invest in American production of battery cells for electric vehicles. The facility is set to start mass producing advanced lithium-ion battery cells by the end of 2025.
CNBC Pro: Analyst names the stocks 'at risk of going to $0' and 3 top picks, giving one over 80% upside
Stocks burning through cash are about to get hit, says David Trainer, CEO of investment research firm New Constructs.
That's because interest rates are going to get even higher, which means liquidity will start to dry up, he explained
He tells investors to avoid "zombie" stocks and identifies stronger bets.
— Weizhen Tan
Oil prices rebounding in late August
After falling for much of July and August, the price of oil is starting to make a comeback.
Oil prices settled up more than 4% on Monday, and futures for U.S. benchmark West Texas Intermediate crude is now trading above $96 per barrel again.
The volatility in oil prices reflects uncertainty about supply, with the Russia invasion of Ukraine ongoing and OPEC+ considering output cuts, and demand, with growing concerns about a global recession.
Lower oil prices were also a major reason for cooler inflation readings for the U.S. in recent weeks.
— Jesse Pound