Asian stocks mostly lower after Wall St falters

Stocks in Asia were mixed on Tuesday amid gloom over European debt after Wall Street failed to provide any inspiration despite an initial bounce on news that Osama bin Laden was dead.

Sydney closed 0.84 percent down, Seoul dropped 1.27 percent. Shanghai was up 0.71 percent and Hong Kong lost 0.37 percent.

Tokyo was closed for the first day of a three-day holiday.

"Osama bin Laden's death was overshadowed by renewed concern about European sovereign debt, particularly in relation to Greece," said RBS Morgans investment adviser Chris MacDonald in Sydney.

Hong Kong had spent much of the day in positive territory before dropping in the last hour of trading to close at 23,633.25, down 87.56 points.

Seoul, where the KOSPI lost 28.23 points to stand at 2,200.73, was hit by profit-taking.

Chinese shares reversed early losses as concerns over further tightening measures eased with data showing manufacturing growth slowed in April, dealers said.

The Shanghai Composite Index, which covers both A and B shares, ended 20.68 points higher at 2,932.19 on turnover of 102.7 billion yuan ($15.8 billion).

Stocks in Sydney fell, with a strong Australian dollar weighing on sentiment over upcoming corporate earnings results.

The benchmark S&P/ASX 200 was down 40.7 points at 4,784.6.

"The market is uncertain as to how big and widespread these downgrades may be, hence the cautiousness we are seeing in trade at the moment," said Ben Potter from IG Markets.

"Markets hate uncertainty, so we're likely to see this continue until some clarity prevails." AFP