US President Donald Trump said on Tuesday he did not support everything in a $1 trillion Senate Republican coronavirus relief proposal the day after it was unveiled by Majority Leader Mitch McConnell, although he indicated talks were continuing.
"We've had some negative leads particularly from US and European stock markets," said Michael McCarthy, chief market strategist at CMC Markets in Sydney, pointing to the overnight decline of Asia-Pacific futures as an indicator of the market opening.
Hong Kong's Hang Seng index futures were down 0.14 per cent. Australian S&P/ASX 200 was flat while Japan's Nikkei 225 futures dipped 0.5 per cent.
US data released on Tuesday showed consumer confidence ebbed in July as coronavirus infections flared across the country.
The data, along with stimulus concerns, weighed down Wall Street, where the Dow Jones Industrial Average fell 0.77 per cent, the S&P 500 dipped 0.65 per cent, and the Nasdaq Composite lost 1.27 per cent.
"The only positive news is for those holding quantities of gold and those in New Zealand, where job numbers rose in June," wrote Tapas Strickland, an economist at NAB in a research note on Wednesday.
Worsening coronavirus outbreaks in Florida and Texas added to the caution. Florida reported 191 deaths in a 24 hour period ending on Tuesday, marking a record one-day rise for the third-most populous US state and prized destination for beach-goers and retirees.
Texas, the second-most populous state, added more than 6,000 new cases on Monday, pushing its total to 401,477, according to a Reuters tally.
The rise in US deaths and infections has dampened early hopes that the country was past the worst of an economic crisis that has decimated businesses and put millions of Americans out of work.
Gold is up over $125 per ounce in little more than a week as investors bet the Federal Reserve will reaffirm its super-accommodative policies at its two-day meeting ending on Wednesday, and perhaps signal a tolerance for higher inflation in the long run. Bullion pulled back from an all-time high reached earlier.
Gold surged to a record high of $1,980.57 per ounce earlier, but prices retreated as much as 3.7 per cent later in the session as investors booked profits and the dollar bounced back.
The dollar index against a basket of currencies gained 0.18 per cent to 93.71, after dropping to 93.47 on Monday, the lowest since June 2018.
"I think the market is just taking a pause, it's been a fairly relentless dollar selloff," said Vassili Serebriakov, an FX strategist at UBS in New York. In commodity markets, oil prices fell as U.S. lawmakers prepared to wrangle over the stimulus package and investors worried about a rise in coronavirus cases worldwide.
Brent crude was last down 0.32 per cent to $43.27 per barrel while US crude remained unchanged at $41.04 per barrel.