Asian stocks were muted on Wednesday, even as Chinese and Hong Kong markets posted strong gains to extend the previous session's rally after China's central bank slashed its medium-term lending facility from 2.3 percent to 2.0 percent, marking the largest reduction of interest rates for one-year loans to financial institutions in history.
The dollar hit a new one-month low versus the euro and a 2 1/2-year trough to sterling as weak U.S. data bolstered the case for deeper rate cuts.
Gold held near record levels amid increased bets for another super-sized interest rate cut at the Federal Reserve's November meeting.
Crude oil retreated from a multi-week high despite industry data pointing to larger-than-expected crude draw.
China's Shanghai Composite index surged 1.16 percent to 2,896.31, extending its stimulus-fueled rally to a second day running. Hong Kong's Hang Seng index rose 0.68 percent to 19,129.10.
China's yuan hit a fresh 16-month high, briefly crossing the key 7-per-dollar level in offshore trading, following interest-rate cuts and new measures from the country's central bank.
China's central bank lowered the rate on medium-term lending facility on Wednesday after unleashing an aggressive monetary easing package on Tuesday.
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The interest rate on medium-term lending facility was reduced to 2.0 percent from 2.3 percent, the People's Bank of China said in a statement. The last reduction was in July.
The PBoC conducted a CNY 300 billion MLF to maintain reasonable and ample liquidity in the banking system. The outstanding balance of the MLF was CNY 6.878 trillion.
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