HONG KONG (AFP) - Asian shares closed mixed after a choppy session on Wednesday, with investors selling off Chinese stocks despite an interest rate cut, while other markets found their footing.
The dollar edged up in Tokyo, extending a rebound from this week's heavy losses after China's move to cut its key rates and free up cash for banks to lend spurred optimism about the world's second-largest economy.
Tokyo surged 3.20 per cent, or 570.13 points, to close at 18,376.83 - rebounding from a six-month low in the previous session after their worst two-day plunge since 2011.
Sydney closed up 0.69 per cent, or 35.52 points, at 5,172.77 and Seoul rose 2.57 per cent, or 47.46 points, to 1,894.09.
But Shanghai fell 1.27 per cent, or 37.68 points, to 2,927.29, after a day that saw it veer wildly between losses and gains of around four per cent, while Hong Kong lost 1.52 per cent, or 324.57 points, to 21,080.39.
"China did what the market was looking for... by easing policy, but it appears that the markets want more. Thanks, but we are not quite happy yet," National Australia Bank senior currency strategist Emma Lawson said.
China's central bank on Tuesday warned that the "economic growth rate remains under pressure", adding the cuts were meant in part to "support the real economy to continue to develop healthily".
The People's Bank of China (PBoC) cut its benchmark lending and deposit interest rates by 0.25 percentage points each and its reserve requirement ratio by 0.50 percentage points - the second such combination move in two months.
Fears of stalling growth in China, the world's second-largest economy, sparked one of the worst routs since the global financial crisis, with commodities, emerging market currencies and shares all diving.
Traders said the rate cuts had restored some confidence that Beijing would act to shore up both its economy and its stocks, but more needed to be done to calm frazzled investors.
"A circuit-breaker is needed to dispel excessive pessimism and restore confidence," Frederic Neumann, co-head of Asian economics research at HSBC in Hong Kong, told Bloomberg News.
"Further support measures in the coming weeks and months will be needed." In currency trade, the dollar remained under pressure at 119.52 yen, up from 118.84 yen in New York trade Tuesday, but dramatically weaker than the 122.06 yen seen in US trade on Friday.
The euro stood at US$1.1481 and 137.23 yen in Tokyo, compared with US$1.1518 and 136.87 yen in New York overnight.
Oil prices gained ahead of the latest US energy report, after plummeting to their lowest levels since early 2009 this week as investors fretted about falling demand in the face of a world supply glut.