Asian markets switched between gains and losses after earnings reports gave a boost to Wall Street and the Bank of Japan (BoJ) left policy unchanged.
However, investors held back in anticipation of the Federal Reserve's decision on monetary policy. The Fed is widely expected to continue tapering of its bond-buying programme.
Few investors believed the BoJ would opt for further stimulus at the present time but market participants looked to when the central bank may go in for further easing.
London-based consultancy Capital Economics think the BoJ will announce more easing in the second half of the year, with inflation falling short of the BoJ's target of two per cent.
Japanese companies are predicting output to decline by 1.4 per cent in April and to remain roughly the same in May. Capital Economics warn that firms are being overly optimistic about future production levels, so the results may turn out to be even weaker than already forecast.
Japan's manufacturing purchasing managers' index (PMI) slipped to the lowest level since February last year from 53.9 to 49.4.
The Nikkei is up 0.2 per cent, while the Topix has also risen by 0.2 per cent. The Hong Kong Hang Seng Index has fallen by 1.1 per cent, with South Korea's Kospi suffering losses of 0.3 per cent. The Shanghai Stock Exchange Composite Index is broadly flat.