A weak round of US data dented confidence on trading floors Wednesday, sending investors running for safe investments ahead of policy announcements by the Federal Reserve and Japan's central bank.
Dealers are nervous heading into the corporate earnings season, with equities and currency markets having suffered their worst quarter in four years during July-September.
Analysts warned against reading too much into better-than-expected sales in China for online giant Alibaba, which came in the face of a growth slowdown in the world's number two economy.
While global markets have enjoyed a broadly healthy run in October on expectations the Fed will delay lifting interest rates until next year, another batch of figures indicating a stuttering US economic recovery knocked sentiment.
On Tuesday the US Conference Board said an index of consumer confidence fell in September owing to a gloomier outlook for the economy, while the Commerce Department said durable goods orders dipped for a second straight month.
The figures come after a Labor Department report at the start of the month showing jobs growth was weaker than expected in September increases the chances the Fed will keep rates on hold until the new year. Wednesday sees its second-last policy meeting before the end of 2015.
"I don't think the Fed is going to risk tightening policy this year," Nader Naeimi, the Sydney-based head of dynamic asset allocation at AMP Capital Investors Ltd, told Bloomberg News.
Tuesday's results also led to losses on Wall Street. The Dow shed 0.24 percent, the S&P 500 dipped 0.26 percent and the Nasdaq eased 0.09 percent.
- Risky currencies fall -
In Asia Tuesday high-yielding, riskier, assets were hit.
The dollar eased to 120.45 yen from 120.48 yen in New York and well off the 120.71 yen earlier Tuesday in Asia.
The euro was at $1.1032 and 132.87 yen from $1.1041 and 133.02 yen in US trade. That is well off the $1.1070 and 133.46 yen in Tokyo Tuesday.
The strengthening of the yen comes before the Bank of Japan's policy gathering that ends Friday, with pressure on board members to increase its stimulus to kickstart the sluggish economy.
The dollar climbed against emerging market units. The Malaysian ringgit fell 0.47 percent, the South Korean won lost 0.11 percent and the Indonesian rupiah shed a marginal 0.07 percent.
Australia's dollar sank more than one percent against the greenback after inflation in the country remained weak and came in below forecasts, fanning speculation the central bank will cut borrowing costs next week.
Asian equities were also broadly lower, with Hong Kong down 0.60 percent, Shanghai losing 0.62 percent and Sydney down 0.11 percent. But Tokyo gained 0.60 percent by lunch following a sell-off on Tuesday.
In China Alibaba on Tuesday said online sales surged 28 percent in the three months ended September, while net profit including investment gains rose 36 percent.
However, while the result beat expectations owing to China's ongoing malaise, Gil Luria, analyst at Wedbush Securities in Los Angeles, said it mostly came because of the firm's sales strategy.
"This has little to do with the Chinese consumer but rather Alibaba improving its ability to allow sellers to advertise on mobile screens," Luria said.