HONG KONG - Asian markets rebounded on Tuesday after a three-day sell-off as renewed fears over eurozone debt were soothed with the European Central Bank indicating it could step in if needed.

However, ongoing jitters over the strength of the global economy kept a lid on sentiment while geopolitical concerns weighed amid North Korean plans for a rocket launch.

Tokyo added 0.70 per cent, or 66.05 points, to 9,524.79, Sydney added 0.81 per cent, or 34.4 points, to 4,280.5 and in the afternoon Hong Kong was 0.64 per cent higher while Shanghai gained 1.44 per cent.

Seoul fell 0.39 per cent, or 7.78 points, to 1,986.63.

The gains bring an end to recent selling pressure sparked by weak US jobs data last week, another set of poor Chinese economic figures and fresh anxiety that Spain could be engulfed in a Greece-style debt crisis.

A slump in Asia on Wednesday followed Wall Street and Europe after bond yields for Madrid shot to highs not seen since December on fears recent austerity measures could send it deeper into recession.

But investors took heart from ECB board member Benoit Coeure, who suggested that markets were overestimating the extent of Spain's problems and did not rule out additional purchases of sovereign debt by the central bank.

Spain's benchmark 10-year bond yields eased to 5.87 per cent from 5.94 per cent.

Stocks in New York and Europe also bounced back on Wednesday.

London's FTSE 100 index added 0.70 per cent, Frankfurt's DAX 30 rose 1.03 per cent and the Paris CAC 40 gained 0.62 per cent, while the Madrid Ibex 35 was 1.93 per cent higher.

On Wall Street the Dow closed up 0.70 per cent, the S&P 500 gained 0.74 per cent and the tech-heavy Nasdaq climbed 0.84 per cent.

But Mitul Kotecha, strategist at Credit Agricole, warned that renewed debt worries "will not fade quickly while growth concerns have been reignited by last week's weaker than expected US jobs report".

The euro edged back up on the news and bought US$1.3137 (S$1.6564) in early Tokyo trade, from US$1.3108 late Wednesday in New York while it also rose to 106.35 yen (S$1.6590)from 106.00 yen. The dollar was at 80.96 yen against 80.86 yen.

On Wednesday in Asia the euro was buying US$1.3101 and 105.90 yen as traders shifted away from the higher risk unit.

Regional markets were also nervous as North Korea prepared to fire a long-range rocket which it says will place a satellite in orbit for peaceful research purposes.

Western critics see the launch as a thinly veiled ballistic missile test, and the United Nations has banned such tests by Pyongyang.

Dealers are on edge as they await the launch, which is due to take place between April 12 and 16 to commemorate the centenary of the birth of North Korea's founding leader Kim Il-Sung.

"Geopolitical risk could ripple through the markets quite a bit. Some are taking a wait-and-see mode," Yoshihiro Okumura, general manager of research at Chibagin Asset Management in Tokyo, told Dow Jones Newswires.

On oil markets New York's main contract, West Texas Intermediate crude for delivery in May was up US$0.19 at US$102.89 per barrel while Brent North Sea crude for May rose four cents to US$120.23.

Gold was at US$1,658.80 an ounce at 0600 GMT, compared with US$1,654.75 late Wednesday.

In other markets:

- Taipei ended flat, adding 6.25 points to 7,662.92. Hon Hai Precision rose 0.44 per cent to Tw$114.0 (S$4.87) while Taiwan Semiconductor Manufacturing Co was 0.24 per cent higher at Tw$82.6.

- Wellington rose 0.63 per cent, or 21.70 points, to 3,487.09. Contact Energy gained 1.1 per cent to NZ$4.83 and Telecom was up 0.6 per cent at NZ$2.51 (S$2.58) while Fletcher Building added 2.2 per cent to NZ$6.15.