Asia markets were mixed in mid-morning trade on Tuesday after a lower finish in US equities overnight ahead of earnings season.

Australia's ASX 200 was up 0.55 percent, with the heavily-weighted financials subindex advancing 0.98 percent. The country's so-called Big Four banks - ANZ, Commonwealth Bank of Australia, Westpac and NAB - traded up between 0.89 and 2.53 percent. In recent weeks, the banking stocks had come under pressure over concerns of bad debts due to their exposure to the energy and resources sectors.

Japan's Nikkei 225 was up 1.13 percent, buoyed by the yen's retreat back to the 108 handle against the dollar. Across the Korean Strait, the Kospi retraced some of the early gains to trade up 0.11 percent. In Hong Kong, the Hang Seng index wavered between gains and losses in early trade, before trading down 0.14 percent.

Chinese mainland markets opened lower, with the Shanghai composite down 0.35 percent and the Shenzhen composite losing 0.56 percent.

Rodrigo Catril, a currency strategist at the National Australia Bank, wrote in a morning note that the struggle for direction in U.S. equity markets reflected "a lack of conviction ahead of the 'true' start to the quarter earnings reporting season."

In the currency market, the dollar weakened against a basket of currencies, with the dollar index dropping to 93.95 overnight. As of 9:36 a.m. HK/SIN time on Tuesday, the index traded at 93.96.

Kathy Lien, managing director of foreign exchange strategy at BK Asset Management, wrote in a note that investors are reluctant to own dollars. "They are still skeptical about a 2016 rate hike even though each and every Federal Reserve official who has spoken, dove and hawks included, see tightening in 2016," she said.

The Japanese yen, on the other hand, retreated to the 108 handle against the dollar, with the currency pair finishing at 107.93 in the previous session. On Tuesday morning, the dollar/yen pair traded at 108.17.

The yen's relative weakness this morning sent Japanese export stocks higher, with shares of Toyota adding 3.26 percent, Nissan gaining 3.47 percent and Honda up by 3.61 percent. A weaker yen is a positive for Japanese exporters as it increases their overseas profits when converted into local currency.

The Australian dollar traded at USD 0.7610 as of 9:37 a.m. HK/SIN time, after finishing at USD 0.7594 in the previous session. Analysts attributed the uptick in the Aussie to advances in commodity prices and improvement in risk appetite.

Lien added the deluge of Chinese economic data due this week will also be a focus for the Aussie.

The Chinese yuan was slightly weaker against the dollar, with the dollar/yuan pair trading at 6.4628. Before market open, the People's Bank of China fixed the yuan mid-point at 6.4616, compared with Monday's fix at 6.4649. China's central bank lets the yuan spot rate rise or fall a maximum of 2 percent against the dollar relative to the official fixing rate.

In Asian hours, oil prices retreated slightly, with US crude futures down 0.30 percent at USD 40.24 a barrel, while global benchmark Brent dropped 0.21 percent to USD 42.74.

Overnight, oil prices advanced ahead of the April 17 meeting of oil producers in Doha, Qatar, aimed at freezing current output levels. Brent futures added 2.12 percent and US futures tacked on 1.6 percent.

Energy plays in Asia were mixed, with Santos down 1.27 percent, Woodside Petroleum up 0.44 percent and Japan's Inpex adding 2.66 percent. Mainland Chinese oil plays were mixed, with Sinopec shedding 1.97 percent and PetroChina adding 0.13 percent.

Metal plays in the region were mixed. Mining stocks in Australia were mostly up, with major miners Rio Tinto, BHP Billiton and Fortescue advancing between 1.81 and 2.44 percent. Chinese metal plays were mixed, with Baoshan Steel adding 0.17 percent and Aluminium Corp down 0.87 percent.

Overnight, on the London Metal Exchange, base metals closed mixed, with three month aluminum down 0.8 percent, zinc up 0.3 percent and copper up 0.3 percent, according to Reuters. During Asian hours, base metal prices mostly retreated.

Major US indexes closed lower, with the Dow Jones industrial average down 0.12 percent, the S&P 500 off by 0.27 percent and the Nasdaq composite declining by 0.36 percent.

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First Published:Apr 12, 2016 7:54 AM IST