TOKYO – Asian shares were mostly higher in muted trading Wednesday, after discouraging signs about the U.S. economy sent Wall Street shares declining, and

Investors are sifting through a slew of corporate earnings reports to assess how businesses may have been affected by U.S. President Donald Trump’s tariffs.

Among Japanese companies, automakers Honda Motor Co. and Toyota Motor Corp. will report fiscal first quarter results this week, as will electronics and entertainment company Sony Corp.

Japan’s benchmark Nikkei 225 rose 0.6% to 40,777.45. Australia’s S&P/ASX 200 added 0.6% to 8,822.90. South Korea’s Kospi lost 0.3% to 3,187.57. Hong Kong’s Hang Seng rose 0.2% to 24,947.57, while the Shanghai Composite gained 0.3% to 3,627.54.

U.S. futures were up 0.3%.

On Tuesday, the S&P 500 fell 0.5% to 6,299.19, coming off a whipsaw stretch where it went from its worst day since May to its best since May. The Dow Jones Industrial Average dropped 0.1% to 44,111.74, and the Nasdaq composite fell 0.7% to 20,916.55.

A weaker-than-expected report on activity for U.S. businesses in services industries like transportation and retail added to worries that Trump’s tariffs may be hurting the economy. But conversely such indicators raise hopes the Federal Reserve may cut interest rates. That along with a stream of stronger-than-expected profit reports from U.S. companies helped to keep losses in check. The S&P 500 remains within 1.4% of its record.

The pressure is on companies to report bigger profits after the U.S. stock market surged to record after record from a low point in April. The big rally fueled criticism that the broad market had become too expensive.

For stock prices to look like better bargains, companies could produce bigger profits, or interest rates could fall. The latter may happen in September, when the Fed has its next policy meeting.

Expectations have built sharply for a rate cut at that meeting since a report on the U.S. job market on Friday came in much weaker than economists expected. Lower interest rates would make stocks look less expensive, while also giving the overall economy a boost. The potential downside is that they could push inflation higher.

Treasury yields sank sharply after Friday’s release of the jobs report, and they haven’t recovered. The yield on the 10-year Treasury eased to 4.19% from 4.22% late Monday and from 4.39% just before the release of the jobs report. That’s a significant move for the bond market.

In energy trading, benchmark U.S. crude rose 41 cents to $65.57 a barrel. Brent crude, the international standard, added 42 cents to $68.06 a barrel.

In currency trading, the U.S. dollar dipped to 147.34 Japanese yen from 147.61 yen. The euro cost $1.1583, up from $1.1579.

___

AP Business Writer Stan Choe contributed.