Asian shares were subdued on Tuesday while the battered yen hit a record low versus the euro, although the risk of intervention stemmed further weakness against the U.S. dollar.
Treasuries were little changed as caution set in ahead of key U.S. price data on Friday. With the first U.S. presidential debate on Thursday and the first round of voting in the French election at the weekend, investors remain cautious of how political shifts in major economies could impact their positions.
MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS was 0.3% higher, after falling 1.4% in the past three sessions. Japan's Nikkei .N225 rose by 0.5%.
MSCI Asia-Pacific ex-Japan IT index .MIAPJIT00NUS slid 0.5%. Taiwanese shares .TWII fell 0.4%.
Overnight on Wall Street, the Nasdaq .IXIC tumbled over 1%, dragged lower by a 7% drop by AI bellwether Nvidia NVDA.O as investors rotated out of technology stocks. The Dow Jones .DJI , however, rallied 0.7% to a one-month high.
S&P 500 futures ESc1 and Nasdaq futures NQc1 were flat.
"It's difficult to extrapolate what can be attributed to technical factors and what's fundamentals in the markets, with price action apparently driven by end-of-month and end-of-quarter positioning," said Kyle Rodda, a senior analyst at Capital.com.
"A sell-down in tech, despite little shift in rates expectations and the outlook for earnings, may signal a trimming by investors of the quarter's big winners."
Chinese stocks were slightly higher, with the blue chips .CSI300 eking out a slight gain of 0.1% while Hong Kong's Hang Seng index .HSI rose 0.9%.
In a worrying sign about the health of Chinese consumers, e-commerce sales declined for the first time during the so-called 618 shopping festival that ended last week, reports said.
The king dollar dipped a little overnight after recent broad-based gains. The dollar index =USD was last flat at 105.46, having eased 0.3% overnight against a basket of major currencies.
The yen JPY=EBS rose 0.1% to 159.45 per dollar, although it is still pinned near levels not seen since late April when the Japanese authorities intervened in the market to stem the currency's fast declines.
Japanese Chief Cabinet Secretary Yoshimasa Hayashi said on Tuesday the authorities are closely watching currency moves and will respond appropriately to excessive volatility.
The currency, however, kept weakening against other major currencies, with the euro EURJPY=R breaking major resistance to hit a record top of 171.49 yen overnight. It was last off 0.1% at 171.08 yen.
The Australian dollar AUDJPY=R also climbed for a sixth straight session to 106.38 yen, a 17-year high, thanks to persistent demand for carry trades.
Looking ahead, the much watched U.S. personal consumption expenditures (PCE) price index is due on Friday. Annual growth in the Federal Reserve's favoured core inflation index is expected to slow to 2.6% in May, the lowest in more than three years.
A low result would likely reinforce market bets on a Fed rate cut as early as September, which futures currently price as a 65% prospect. Two rate cuts are priced in for the year. FEDWATCH
Treasuries are mostly steady so far in the week amid a lack of catalysts. Two-year yields US2YT=RR held at 4.7255%, little changed for the week while the 10-year yield US10YT=RR eased 1 basis point to 4.2341%, and was down 2 bps for the week.
Oil prices were flat for the day. Brent LCOc1 futures held at $85.95 a barrel while U.S. crude CLc1 was little changed at$81.60 a barrel.
Gold prices XAU= slipped 0.3% to $2,325.52 per ounce.
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