HONG KONG – Asian shares inched up on Tuesday morning as positive economic data offered some respite to the recent sell-offs, though persistent fears about a global recession and sky-high inflation kept most buyers at bay.

MSCI's gauge of Asia Pacific stocks outside Japan was up 0.3 percent, having erased part of the early morning gains.

The index has fallen 16 percent so far this year, as worries that central banks around the world will push economies into recession to break red-hot inflation have sent investors running for cover.

There was positive data from Japan where the country's services sector activity expanded at the fastest pace in over eight years in June as the easing of coronavirus curbs boosted sentiment among businesses such as those in tourism, helping the Nikkei to rise 0.8 percent.

Referring to the global growth and inflation dynamics, Redmond Wong, market strategist at Saxo Markets Hong Kong, said: "Market participants are still assessing the impact of the tug of war between inflation being at persistently elevated levels and signs pointing to potentially an incoming US recession."

Those concerns were front and centre in South Korea, where June inflation accelerated to the fastest pace since the Asian financial crisis, fanning expectations the central bank could deliver a 50 basis point rake hike for the first time next week to cool prices.

Australia's central bank meets later in the day with analysts expecting another 50-basis-point rate hike to tamp down galloping inflation.

US markets were closed overnight for the Fourth of July holiday, and US share futures rose in Asia trade, with S&P500 e-mini futures up 0.4 percent.

In currency markets the dollar index was steady at 105.7, still broadly supported by its safe-haven credentials.

US treasury yields returned from the holiday higher, with the yield on benchmark 10 year notes at 2.9686 percent but failing push back above the symbolic 3 percent level.

Brent crude futures rose 0.4 percent to $113.92 a barrel after a 2.4 percent gain on Monday, as a strike in Norway is expected to disrupt oil and gas output, fanning tight supply worries.

Spot gold was trading flat at $1809.2 an ounce, paring Monday's losses.