MSCI's gauge of Asia Pacific stocks outside Japan was up 0.02% at 0201 GMT, paring earlier losses. At current levels, the index is set to post its biggest monthly gain since April 1999.
Hong Kong's Hang Seng Index and China's benchmark CSI300 Index, though, opened down 0.4% and 0.3% respectively, with China's factory activity contracting at a faster-than-expected pace in November.
China's factory activity deepened this month, an official survey showed on Wednesday, weighed down by softening global demand and COVID-19 restrictions.
The losses in Hong Kong and China reversed positive sentiment from Tuesday, when Chinese officials said the country would speed up COVID-19 vaccinations for elderly people.
The vaccination push was seen as crucial to unwinding nearly three years of strict curbs in the world's second-largest economy that have eroded economic growth, disrupted the lives of millions and sparked unprecedented protests this past weekend.
"Headlines from China regarding COVID restrictions and protests are causing jitters among investors. Although some COVID easing measures are being considered, it may not be enough to prevent further economic disruption," said Anderson Alves, global macro analyst at ActivTrades.
"Expectations are that as COVID cases continue to rise, restrictions will be re-tightened before year-end, bringing with it more uncertainty over the impact on the economy," he said in a research note on Wednesday.
Japan's Nikkei 225 fell 0.55% while Australia's S&P/ASX 200 gained 0.29%.
Sentiments globally are of a cautious tone. The S&P 500 closed lower on Tuesday as investors awaited guidance on the U.S. Federal Reserve's path of interest rate hikes.
Fed Chair Jerome Powell is scheduled to speak about the economy and labour market at a Brookings Institution event on Wednesday. A series of U.S. data concerning manufacturing, inflation and jobs will also be released this week.
"This week will offer an interesting test for markets as we have a look at the next important data macro data points out of the U.S., especially the PCE inflation data and the Friday November jobs report," said Redmond Wong, Greater China market strategist at Saxo Markets in Hong Kong.
The U.S. ISM manufacturing survey for the month on Thursday is also expected to slip into contraction, Wong said.
Oil prices continued to rise after a buoyant Tuesday, with U.S. crude up 0.873% to $78.87 a barrel and Brent up 0.76% to $83.66 a barrel. [O/R]
Spot gold rose 0.13%.
In currency markets the dollar index declined 0.2%.
(Reporting by Kane Wu; Editing by Tom Hogue)
By Kane Wu