Asian stock markets churned on Tuesday following media reports of a pending chipmaking breakthrough in China, and on elevated bond yields and global crude prices.

Hong Kong and Shanghai gained ground, while Tokyo finished in the red.

Seoul's KOSPI index, home to chip giants SK Hynix and Samsung Electronics, tumbled 5.5% following reports that China-based chipmaker CXMT may produce competitive memory chips by the end of 2026, possibly undercutting semiconductor manufacturers outside China.

Brent crude futures traded down 1.5% to $105.02 during Asian market hours.

In Japan, the Nikkei 225 opened lower after a three-day weekend and finished off 1.8%, as tech shares faltered.

The benchmark Nikkei 225 fell 1,253.40 to 67,777.52, although gaining issues outnumbered losers 156 to 67, with declines concentrated among AI- and semiconductor-related issues.

Leading the upside was discount retailer Pan Pacific International, up 4%, while chipmaker Kioxia declined 13.3%.

In economic news, Japan's producer price index rose 6.8% on year in September, but declined 0.3% from August, reported the Bank of Japan.

In Hong Kong, the Hang Seng Index opened lower but rose to the close, finishing up 0.3% on strength in property and bank shares.

The broad gauge Hang Seng rose 74.03 to 24,345.22, as gaining issues outnumbered losers 61 to 32.

The Hang Seng TECH Index lost 0.8% on the day, the Mainland Properties Index rose 0.7%, and the Hang Seng Mainland Banks Index rose 0.4%.

Leading the upside was knitwear maker Shenzhou International, gaining 3.9%, while Hua Hong Grace Semiconductor declined 5.3%.

On the mainland, the Shanghai Composite rose 0.1% to 3,800.86.

On the other regional exchanges, the Taiwan TWSE declined 2%; the Australian ASX 200 was flat; the Singapore Straits Times Index rose 0.3%, and exchanges in Thailand were closed on holiday. In late trading in Mumbai, the Sensex was up 1.5%.

The MSCI All Country Asia Pacific Index fell 1.3% on the day.