Asian stocks mostly edged higher on Thursday (Sep 15), tracking gains on Wall Street as markets adjusted following a rout this week on higher-than-expected US inflation data.
The data showed US yearly inflation slowing less than expected and monthly inflation rising, stoking fears that the US Federal Reserve would continue its aggressive tightening of monetary policy.
On Thursday, bourses in Tokyo, Hong Kong, Taipei, Singapore, Kuala Lumpur and Jakarta made cautious gains.
Markets in Shanghai and Seoul, however, were down at the close.
European stock markets rebounded somewhat at the open on Thursday.
Analysts said markets were bouncing back from the steep losses that followed the inflation data, and traders were pricing in an expected 75 basis-point interest rate hike by the Fed at a meeting next week.
The release of US producer price data also affected market sentiment, showing costs dropping for the second straight month, mainly driven by falling US fuel prices.
"Stock markets have stabilised a little after Tuesday's rout which saw risk assets pummelled across the board", said Craig Erlam, senior market analyst at OANDA.
Tokyo - the previous day's biggest loser in Asia - closed up by 0.2 per cent, but investors there remained wary of the speed and degree of future US rate hikes, analysts said.
In Hong Kong, stocks closed 0.4 per cent higher on Thursday.
On Wednesday, Wall Street stocks rose as investors prepared for next week's Fed decision, with the Dow rising 0.1 per cent and the S&P 500 gaining 0.3 per cent.
Any US interest rate hike tends to strengthen the dollar, and Asian currencies remain at risk from the strong greenback.
On Thursday, the Australian dollar traded near a two-year low, with the yen at near 143 to the US dollar.
A day earlier, Japan's central bank conducted a "rate check" operation on the yen, a move seen as a precursor to possible intervention, and which served to bring the currency back from the 145 level that is widely seen as a threshold by the market.