Asian shares were mostly higher Tuesday as jitters over protests in China set off by growing public anger over COVID-19 restrictions subsided.

U.S. futures edged higher. Oil prices rose more than USD 1 per barrel.

Chinese shares rebounded after they were hit by sharp losses on Monday following protests over the weekend in various Chinese cities. Hong Kong's Hang Seng jumped 4% to 17,981.31, while the Shanghai Composite added 2.3% to 3,148.17.

Japan's Nikkei 225 lost 0.5% to 28,016.58. Australia's S&P/ASX 200 gained 0.3% to 7,249.80. South Korea's Kospi added 0.8% to 2,427.13.

Although market sentiment has been weighed down by the recent demonstrations in China, some analysts noted calm could return in coming sessions. The world's second largest economy has been stifled by a "zero COVID" policy which includes lockdowns that continually threaten the global supply chain.

"The absence of any clear escalation in protests could aid to bring some calm to markets," said Yeap Jun Rong, market strategist at IG.

The unrest has stoked worries on Wall Street that if Chinese leader Xi Jinping cracks down further on dissidents there or expands the lockdowns, it could slow the Chinese economy, which would hurt oil prices and global economic growth, said Sam Stovall, chief investment strategist at CFRA.

"A lot of people are worried about what the fallout will be, and basically are using that as an excuse to take some recent profits," he said.

Stephen Innes, managing partner at SPI Asset Management, said business was returning as usual, although the heavy police presence may unnerve a Western audience.

"Chinese markets are rallying early in the session as local investors take a more pragmatic approach to the current COVID proceedings. Indeed, a probable outcome is a quicker loosening of restrictions once the current COVID wave and numerous protest flash points subside," he said.

Japanese government data released Tuesday showed that the unemployment rate for October was unchanged from September at 2.6%. Separately, data released by another ministry showed a slight increase in the number of available jobs per job-seeker at 1.35. The increase has continued for 10 months.

Hiring was up in anticipation of tourists returning in droves to Japan. Borders that have been basically closed during the coronavirus pandemic have reopened at a time when the declining value of the yen against the U.S. dollar and other currencies make Japan an attractive destination for tourists.

On Monday, more than 90% of the stocks in the S&p;P 500 closed in the red, with technology companies the biggest weights on the broader market. Apple, which has seen iPhone production hit hard by lockdowns in China, fell 2.6%.

Several casino operators gained ground as the Chinese gambling haven of Macao tentatively renewed their licenses. Las Vegas Sands rose 1.1% and Wynn Resorts gained 4.4%.

The fallout from the collapse of crypto exchange FTX continued. Cryptocurrency lender BlockFi is filing for Chapter 11 bankruptcy protection. Cryptocurrency exchange Coinbase Global fell 4% and the price of Bitcoin slipped 2.1%.

The S&P 500 fell 1.5% to 3,963.94. The Dow dropped 1.4% to 33,849.46. The tech-heavy Nasdaq lost 1.6% to close at 11,049.50.

Anxiety remains high over the ability of the Federal Reserve to tame inflation by raising interest rates without going too far and causing a recession. The central bank's benchmark rate currently stands at 3.75% to 4%, up from close to zero in March. It has warned it may have to ultimately raise rates to previously unanticipated levels to rein in high prices on everything from food to clothing.

Federal Reserve Chair Jerome Powell will speak at the Brookings Institution about the outlook for the U.S. economy and the labor market on Wednesday.

The Conference Board will release its consumer confidence index for November on Tuesday. That could shed more light on how consumers have been holding up amid high prices and how they plan on spending through the holiday shopping season and into 2023.

The U.S. government will release several reports about the labor market this week that could give Wall Street more insight into one of the strongest sectors of the economy. A report about job openings and labor turnover for October will be released on Wednesday, followed by a weekly unemployment claims report on Thursday. The closely watched monthly report on the job market will be released on Friday.

In energy trading, benchmark U.S. crude added1.37 to78.61 a barrel in electronic trading on the New York Mercantile Exchange. Brent crude, the international standard, rose USD 1.81 to USD 85.00 a barrel.

In currency trading, the U.S. dollar fell to 138.53 Japanese yen from 138.90 yen. The euro cost USD 1.0387, up from USD 1.0344.

AP/PTI