Investors now await the European Central Bank policy meeting later this week and the Sept. 17-18 meeting of the U.S. Federal Reserve for clues on rates.
Investor sentiment was however broadly positive as weak data out of the United States and China spurred hopes of further stimulus measures to prop up floundering economic growth in the world's two top economies.
U.S. job growth slowed more than expected in August, with retail hiring declining for a seventh straight month. Economists said the report was consistent with an economy that was slowing.
Meanwhile, China's exports unexpectedly fell in August, hurt by a slowdown in shipments to the United States, raising the case for more stimulus as the Sino-U.S. trade war drags on.
The bleak data comes after central banks of both countries indicated a move toward sustaining economic growth.
Federal Reserve Chair Jerome Powell said the Fed would continue to act "as appropriate" to sustain the economic expansion in the world's biggest economy.
Meanwhile, the People's Bank of China said it was cutting the amount of cash that banks must hold as reserves for the third time this year, releasing 900 billion yuan ($126.35 billion) in liquidity to shore up the flagging economy.
"Clearly, China is moving away from the direct prime-pump while focusing more on boosting consumption and structural reform. This may limit the spill-over effect of China's stimulus on the regional economies," OCBC said in a note to clients.
Data also shows valuations of Asian shares took a hit in August after a sharp selloff due to an escalation in the Sino-U.S. trade war, with MSCI's broadest index of Asia-Pacific shares <.MIAP00000PUS> declining 3.4%.
Philippine stocks <.PSI> closed 0.3% higher, extending gains into a fourth session, boosted by financials.
SM Prime Holdings Inc gained 1.3%, while Bank of the Philippine Islands rose 4.2%.
Vietnam shares <.VNI> closed little changed, with real estate conglomerate Vingroup JSC rising 1.2% after a consortium led by Singapore's state investor GIC Pte Ltd signed an agreement to buy a stake in one of its units for $500 million.
Indonesian shares <.JKSE> rose 0.3%, driven by consumer and energy stocks.
United Tractors Tbk Pt rose 8%, while Charoen Pokphand Indonesia Tbk Pt advanced 5.5%.
The Malaysian stock market <.KLSE> was closed for a holiday.
(Reporting by Shreya Mariam Job in Bengaluru; Editing by Subhranshu Sahu)
By Shreya Mariam Job