Asian shares outside Japan mostly rebound early Friday, recovering from early losses after the Federal Reserve cited concerns about global economic growth in its decision to hold off on its first rate hike in nearly a decade.

"In the grand scheme of things, the decision by the Fed to leave rates unchanged is indicative that the global economy and the U.S. economy is performing worse than previously projected," IG's market analyst Angus Nicholson wrote in a note.

Wall Street indexes gave up a 1-percent rally to end mostly lower overnight. The blue-chip Dow Jones Industrial Average and the S&P 500 slipped 0.4 and 0.3 percent respectively, while the Nasdaq Composite inched up 0.1 percent.

Nikkei loses 1.5 percent

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Japan's Nikkei 225 index and the broader Topix index were among the hardest-hit in Asia, down more than 1 percent early Friday.

Financials endured particularly heavy selling, with Sumitomo Mitsui Financial Group and Mitsubishi UFJ Financial Group tanking more than 2 percent each. Nomura Holdings also receded 2.7 percent.

With dollar-yen ticking down at 119.90, exporters traded on the back foot. Blue-chip names Toyota Motor and Canon eased nearly 2 percent each, while Panasonic slumped 2.7 percent.

Inpex and Showa Shell declined more than 1 percent each, after West Texas Intermediate (WTI) eased 25 cents at $46.90 on the back of the Fed's decision.

Meanwhile, the Bank of Japan (BOJ) policymakers agreed that emerging economies had suffered from weak growth but were likely to improve from a somewhat long-term perspective, minutes from the central bank's policy meeting held earlier this week showed. The BOJ kept monetary policy steady on Tuesday, in line with expectations.

Shanghai Comp sags 0.1 percent

China's Shanghai Composite index dipped slightly into the red, reversing a brief positive open, as banks and energy plays lagged.

Heavyweight component PetroChina and Sinopec slipped 0.4 and 0.2 percent respectively, Industrial and Commercial Bank of China (ICBC) inched down 0.2

percent.

Developers mostly strengthened, with Poly Real Estate and Shanghai Shimao up 0.6 and 0.4 percent respectively, after data showed China's new home prices

fell 2.3 percent in August, according to calculations done by Reuters, beating expectations for a drop of 3.7 percent.

Among other indexes, the benchmark CSI300 Index edged up 0.5 percent and the smaller Shenzhen Composite inched up 0.2 percent.

ASX gains 0.3 percent

Australia's S&P ASX 200 index turned positive by mid-morning trade, underpinned by a stellar rise in gold producers.

Newcrest Mining rallied 6.4 percent as the price of goldfirmed near a two-week high in early Asian trade. Evolution Mining and Kingsgate Consolidated climbed

4.1 and 2.8 percent respectively.

By contrast, oil-related counters such as Santos, Oil Search and Woodside Petroleum declined between 0.2 and 1 percent, in tandem with weaker oil prices.

National Australia Bank and Australia and New Zealand Banking recouped losses to head back into positive territory, while Westpac shed 0.1 percent.

In the currency space, the Australian dollar hit a three-week high of $0.7277 against the dollar following the policy announcement, but has since retreated back

to $0.7187. In a testimony before parliament on Friday, Reserve Bank of Australia (RBA) Governor Glenn Stevens said he is not especially concerned by the

prospect of higher U.S. interest rates and expects a rate hike before the end of 2015.

"For Australia, the Fed's decision is a mixed blessing. On the one hand it would have been better to see the Fed able to raise interest rates as it would signal

greater confidence in global growth and ongoing downwards pressure on the Aussie dollar," Shane Oliver, head of investment strategy and chief economist at

AMP Capital, said.

"Ultimately though the downtrend in the Aussie dollar is likely to resume as the Fed is still likely to hike at some point, the RBA is likely to remain under pressure

to cut and commodity prices remain weak so there is no change to my view that the Aussie dollar will fall to around $0.60 in the next 12 months or so," Oliver

added in his note.

Kospi adds 0.2 percent

South Korea's Kospi index clawed back early losses to inch up above the flatline.

The index's top weighted stock Samsung Electronics erased a 1-percent decline to trade flat, while Hyundai Motor skidded 1 percent.

Banking shares tracked the region-wide sluggishness; Shinhan Financial Group and Woori Bank plunged 3.9 and 2.7 percent respectively.

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Rest of Asia

Elsewhere in the region, Singapore's Straits Times index was little moved. Malaysian and Taiwanese shares edged down modestly in early trade.

First Published:Sept 18, 2015 7:47 AM IST