Japan's Nikkei took an early 0.3 percent drop as exporters were hit by recent broad-based gains in the yen. MSCI's broadest index of Asia-Pacific shares outside Japan eased 0.1 percent, while Australia's main index edged up 0.1 percent.
SYDNEY: Most Asian share markets slipped on Monday amid reports Washington was about to announce a new round of tariffs on Chinese imports, setting the stage for possible reprisals by Beijing.
Liquidity was thin with Japan on holiday and moves in currencies and bonds were minor. Hong Kong markets opened as normal after a super typhoon brushed the city on its way to landfall in China's Guangdong, the country's most populous province.
MSCI's broadest index of Asia-Pacific shares outside Japan dropped 1 percent, snapping three straight sessions of gains.
Shanghai blue chips fell 0.8 percent, while the Hang Seng shed 0.9 percent. EMini futures for the S&P 500 were off 0.2 percent.
U.S. President Donald Trump is likely to announce new tariffs on about $200 billion on Chinese imports as early as Monday, a senior administration official told Reuters.
The tariff level will probably be about 10 percent, the Wall Street Journal reported, below the 25 percent the administration had said it was considering.
The WSJ also reported Beijing may decline to participate in proposed trade talks with the United States later this month if the Trump administration moves forward with the tariffs.
Other officials who advise the country's leaders are suggesting China impose limits on the sale of parts and supplies needed by U.S. businesses, using "export restraints" to threaten their supply chains.
"Further escalation looks very likely in which the rate will likely be raised to 25 percent and more U.S. tariffs threatened, while China may potentially pull out of trade talks entirely and escalate on the new front of outright export restrictions," wrote analysts at JPMorgan.
"This would of course only inflame the situation further."
In currency markets the dollar index <.DXY> was a fraction firmer at 94.940, having bounced from a low of 94.359 at the end of last week.
The euro held at $1.1628
In commodity markets, gold was stuck at $1,194.70 an ounce
Oil prices eased as the Sino-U.S. trade dispute outweighed the risks to supply from upcoming sanctions on Iran. Brent dipped 4 cents to $78.06 a barrel
