Asian share markets were left in limbo on Wednesday as optimism over the US-Mexico trade deal was quickly replaced by caution ahead of a looming deadline on tariffs with China.

A flat finish on Wall Street and a dearth of major economic data across the region pointed to a quiet session ahead. MSCI's broadest index of Asia-Pacific shares outside Japan edged up just 0.02 per cent in early trade.

Japan's Nikkei rose 0.3 per cent, while EMini futures for the S&P 500 added 0.11 per cent. Wall Street offered little in the way of direction. The Dow ended Tuesday up a bare 0.06 per cent, while the S&P 500 gained 0.03 per cent and the Nasdaq 0.15 per cent.

Analysts at JPMorgan noted the deadline for public comment on US President Donald Trump's increased tariffs on $200 billion of Chinese goods was less than a week away on September 5.

“End-of-month flows could start to take hold into the end of the week, and combined with light news flow and the risk of impending trade war escalation could result in conviction remaining light,” they cautioned.

3-nation NAFTA pact

In Washington, Canada's main trade negotiator was in talks to preserve a three-nation North American Free Trade Agreement following Monday's deal between the United States and Mexico. President Trump warned he could proceed with Mexico alone and levy tariffs on Canada if it does not come on board with the revised trade terms.

Yet even if Trump were to go with Mexico alone, Congress would have to approve the deal in a process that would take months and put it beyond the mid-term elections.

“In a nutshell it seems that many contentious issues remain unresolved and there is a very tight timeline that needs to followed if a NAFTA deal is to be ratified by the current US Congress,” NAB analysts said in a note.

The White House has also said it wants to settle NAFTA before dealing with China, suggesting that trade dispute could run well into 2019.

Major currencies were quiet, with the dollar index all but flat at 94.738 after touching a three-week low overnight. It was going nowhere on the yen at 111.24, having spent the past three sessions in a 110.93/111.49 range.

The euro held at $1.1693 after topping out at $1.1733 overnight. It faces stiff resistance in the $1.1750/90 zone and lingering concerns over Italy where political uncertainty drove bond yields toward three-month highs.

In commodity markets, spot gold eased back to $1,202.11 after running into profit-taking at $1,214.28, its highest level since August 10. Oil prices were a shade firmer. Brent added 7 cents to $76.05 a barrel, while US crude rose 9 cents to $68.62 .

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