HONG KONG - Asian markets were mixed on Tuesday in quiet trade after the previous day's rally, with Wall Street providing a lacklustre lead while eyes were on a Bank of Japan policy meeting.
The dollar held up against the yen after climbing in New York following news that Standard & Poor's had upgraded its debt rating outlook on the United States.
Tokyo traded flat a day after it surged almost five per cent on upbeat US jobs news that allayed fears the US Federal Reserve will begin to soon row back on its easy money policy.
Hong Kong was also flat, while Sydney added 0.19 per cent and Seoul was 0.60 per cent lower.
Shanghai was closed for a public holiday.
The BoJ concludes its two-day policy meeting later on Tuesday, with some analysts tipping new measures to calm recent volatility in the markets.
Some market participants speculate that the central bank will extend the length of fixed 0.1 per cent rate loans to banks to two years or more from the current one year so that the banks can buy more Japanese government bonds.
"If the bank doesn't do anything, stocks will likely fall," Hideyuki Ishiguro, senior strategist at Okasan Securities, told Dow Jones Newswires.
The dollar stood at 98.78 yen (S$1.2) in early Tokyo trade, compared with 98.87 yen in late Monday in New York and 98.25 yen in Asian trade on Monday.
The greenback has risen sharply since sinking below 96 yen Thursday as dealers feared the Fed would soon begin reeling in its bond-buying scheme.
The euro, which enjoyed a rally in New York, eased to 130.87 yen from 131.05 yen, while it also bought $1.3250 compared with US$1.3254.
Wall Street's lead was tepid as another set of soft Chinese trade and investment data offset the news that S&P had upgraded its US outlook, saying there is now less than a one-in-three chance for a downgrade in the near term.
The agency cited an improved US political climate following the "fiscal-cliff" deal at the end of 2012 and an economic environment that should lead the country to "match or exceed its peers in the coming years".
The Dow and S&P 500 ended flat, while the Nasdaq edged up 0.13 per cent.
Oil prices were mixed, with New York's main contract, light sweet crude for delivery in July, adding seven cents to US$95.84 a barrel and Brent North Sea crude for July shedding 19 cents to US$103.76.
Gold was at $1,383.88 at 0200 GMT from US$1,380.57 late Monday.