Asian markets retreated from the recent multi-month peaks in the morning session as traders looked to take profits while considering domestic corporate earnings and macroeconomic outlook.
Japan's Nikkei average traded 0.51 percent or 56.38 points lower to 11057.57 after soaring to its highest level since April 2010 in the previous session. South Korea's KOSPI was down 0.24 percent or 4.76 points to 1959.67. Australia's S&P/ASX 200 eased 0.47 percent or 23.10 points to 4873.60 after posting the best performance since April 2011 on the previous day.
Hong Kong's Hang Seng slipped 0.52 percent or 123.88 points to 23698.18. Mainland China's Shanghai Composite Index was down 0.32 percent or 7.69 points to 2374.79.
The stage was set for a weak performance in the region after Wall Street pulled back from the recent highs to close lower after the Federal Reserve maintained its monthly bond purchase while suggesting that the low growth rate clocked by the economy in 2012's final months was temporary. Official data had earlier showed that US economy contracted in the fourth quarter.
"The surprise contraction was put down to the cutbacks in defence spending while some blame was attributed to a reduction in business inventories. Companies faced a lot of uncertainty at the back end of 2012 with the fiscal cliff talks at near crisis point," said Weiming Yang, Premium Client Manager at IG Markets in Singapore.
"While the Fed pre-empted the figures by stating that there had been a pause in the US economy, the silver lining was that no announcement was made on scaling back QE3 for the time being".
The central bank also estimated that the country's employment rate will continue to pick up at a moderate pace. The labour market will be in focus during the final days of the week for global markets as traders await monthly non-farm payroll data.
Japanese macroeconomic data once again failed to spur investor sentiments across the region. Official figures from the country's Trade Ministry showed that Japanese industrial output grew less-than-estimated in December, by 2.5 percent. Concerns were further spiked after the dollar weakened against the yen on Fed's policy stand, easing below the ¥91 mark.
Corporate earnings results too weighed the markets lower. Videogames company Nintendo was down 5.03 percent after the firms cut its full year forecast due to weak Wii U console demand.
Some of the major Japanese electronics firms traded lower. Ricoh was down 3.64 percent while Sony and Casio Computers were down 2.68 and 2.97 percent respectively. Financial stocks gained, with Daiwa Securities Group and Sumitomo Mitsui Financial Group adding 3.16 and 3.01 percent respectively.
Commodity stocks plunged in Hong Kong. Citic Pacific was down 3.12 percent while Kunlun Energy fell 3.03 percent. Cnooc was down 3.05 percent after reporting worse-than-expected results in 2013.