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Asia Pacific stocks mixed as Chinese producer prices drop in August

Stocks in Asia were mixed on Tuesday as a data release showed Chinese producer prices in August falling to their worst year-on-year contraction in three years.

Mainland Chinese stocks slipped on the day, with the Shanghai composite down 0.12% to about 3,021.20 and the Shenzhen component declining 0.37% to 9,964.93. The Shenzhen composite shed 0.112% to approximately 1,687.31.

China's producer price index — a key barometer of corporate profitability — fell 0.8% from a year earlier, according to the National Bureau of Statistics. Still, that was better than expectations of a 0.9% shrinkage year-on-year by analysts in a Reuters poll.

Its consumer price index rose 2.8% as compared to the previous year in August, above a 2.6% growth forecast by analysts in a Reuters poll. Food prices soared 10% year-on-year in August, following a 9.1% surge in July. In particular, pork prices in China skyrocketed 46.7% year-on-year in August amid a protracted outbreak of swine fever.

"Without the pork prices, actually the overall inflation should be still okay," Tommy Xie, head of greater China research at Singapore's OCBC Bank, told CNBC's "Street Signs" on Tuesday. "But that may actually pose the risk ... for the China CPI to break the government target of 3% in the last quarter of the year."

Meanwhile, Hong Kong's Hang Seng index was largely flat, as of its final hour of trading.

Elsewhere, the Nikkei 225 in Japan gained 0.35% on the day to 21,392.10, while the Topix index added 0.44% to close at 1,557.99. Shares of automaker Nissan Motor jumped 3.72% after the company's CEO Hiroto Saikawa resigned, effective September 16, following an admission last week that he was improperly overpaid.

Over in South Korea, the Kospi also rose 0.62% to finish its trading day at 2,032.08. Australia's S&P/ASX 200 slipped 0.51% to close at 6,614.10.

In Malaysia, where stocks returned to trading on Tuesday after a holiday yesterday, telecommunications conglomerate Axiata Group saw its stock plunge more than 14% in afternoon trade after the firm ended discussions with Norway's Telenor to create a joint venture.

Overall, the MSCI Asia ex-Japan index was 0.14% lower.

Markets in India were closed on Tuesday for a holiday.

On the trade front, U.S. Treasury Secretary Steven Mnuchin said Monday Washington and Beijing have a "conceptual" agreement on enforcement concerns. Trade negotiations between both countries are expected to continue in the coming weeks.

Iris Pang, greater China economist at ING, said no "material progress" was expected in the upcoming trade talks. "Both sides seem to be standing firm, and are unlikely to give concessions anytime soon."

The U.S. dollar index, which tracks the greenback against a basket of its peers, was at 98.302 after weakening from levels above 98.4 yesterday.

The Japanese yen traded at 107.33 per dollar after weakening from levels below 107.0 in the previous session. The Australian dollar changed hands at $0.6865 after rising from levels below $0.672 last week.

Meanwhile, oil prices continued rising in the afternoon of Asian trading hours following a more than 2% surge on Monday after Saudi Arabia's new energy minister, Prince Abdulaziz bin Salman, committed to crude output cuts to support prices.

International benchmark Brent crude futures gained 0.3% to $62.78 per barrel, while U.S. West Texas Intermediate crude futures rose 0.36% to $58.06 per barrel.

— Reuters and CNBC's Fred Imbert contributed to this report.