SINGAPORE (REUTERS)

Asian stocks found their footing in unsteady trading on Tuesday as investors ​shrugged off doubts about the durability of a Middle East ceasefire to return to favoured AI plays.

MSCI's broadest index of Asia-Pacific shares outside Japan rose 0.4% after fluctuating between gains and losses as trading commenced. Regional declines were led by Korean shares tumbling as much as 3.3% after an initially ⁠higher open, while gains for shares in China and Hong Kong steadied the regional benchmark.

S&P 500 e-mini ​futures were down 0.3%, while in Japan, the Nikkei 225 slumped 0.7%.

Brent crude slipped 0.9% to $94.13 a barrel after Lebanon announced a partial ceasefire between Hezbollah and Israel on Monday, retracing some of Monday's gains after reports that Tehran had halted indirect negotiations with the ‌US.

Markets remain cautious about progress in US-Iran peace talks to end their three-month war, given the ‌fragility of the April ceasefire. Overnight, the S&P 500 closed 0.3% higher after ISM's manufacturing PMI rose to 54.0 in May from 52.7 the previous month, beating expectations to reach the highest level in four years, likely driven by businesses front-loading orders amid rising ​prices and shortages because of the war with Iran.

AI suppliers in Asia made gains after AI developer Anthropic said it ‌had confidentially filed for a US initial public offering, ​which could draw a trillion-dollar valuation.

Alphabet shares slipped 0.7% in after-hours trading after the tech giant said it is looking to raise $80 billion in equity offerings, including an investment from Berkshire Hathaway, in an aggressive push to fund expansion of its AI infrastructure.

Meanwhile, Nvidia CEO Jensen Huang said on Tuesday the AI ​industry bellwether has enough supply to accommodate robust growth in ‌central ⁠processing units (CPUs) and graphics processing units (GPUs), ‌but acknowledged that supply constraints remain a concern.

South Korean equities were especially ‌erratic, with the benchmark KOSPI swinging sharply lower after hitting a record high as bellwethers like Samsung Electronics and SK Hynix flipped between gains and losses. South Korea's consumer price data ⁠were also thrown into the mix for markets, with inflation quickening in May to a more than two-year high, and ​bolstering expectations for a rate hike next month.

Last week, the Bank of Korea signalled an imminent turn towards a more restrictive policy stance to curb inflation and support a slumping won.

The US dollar index, which measures the greenback's strength against a basket of six currencies, held steady at 99.15, firmly within the tight range it has sat in for the past three weeks.

The yield on the US 10-year Treasury bond was down 4.5 basis points at 4.43%. ​

Gold was up 0.9% at $4,523.58 in choppy trade.

Cryptocurrencies fell to two-month lows. Bitcoin was off 1.1% at $70,599.26, ​while ether slid 0.5% to $1,992.04.