TOKYO (AP) -- Stocks were mixed Tuesday on renewed uncertainties over the European debt crisis, after a short-lived rally in Asia driven by the Chinese central bank's move to ease tight liquidity through open market operations.
Early gains were supported by lingering hopes that the European Central Bank might buy bonds to help some European countries reduce their borrowing costs, though such speculation has been countered by denials by ECB officials of such plans, and signs from Germany that it opposes such moves.
In early European trading, the FTSE-100 index of leading British companies rose 0.6 percent to 5,859.03 while Germany's DAX advanced 0.7 percent to 7,079.46. France's CAC-40 climbed 0.8 percent to 3,509.79.
Wall Street looked set to open higher. Dow Jones industrial futures rose 0.2 percent to 13,256 while S&P 500 futures added 0.2 percent to 1,417.50.
Investors are looking for progress from Greek Prime Minister Antonis Samaras' visits this week to Germany and France, where he is expected to request an extension of Greece's deadline to meet fiscal targets as the country carries out painful reforms. Samaras also will meet with visiting Luxembourg Prime Minister Jean-Claude Juncker, who chairs the eurozone finance ministers' meetings, in Athens on Wednesday.
Benchmarks rose in Australia, Singapore, Taiwan and mainland China, buoyed by news the Chinese central bank had moved to ease funding shortages through money market operations. Shares fell back in Japan, South Korea and Hong Kong.
In China, the Shanghai Composite Index jumped 0.5 percent to 2,118.27, boosted also by reports Chongqing, a huge metropolis in southwestern China, plans to spend 1.7 trillion yuan ($236 billion) to upgrade its manufacturing sector.
The advance was mainly a "technical correction" following recent losses, said Zhang Jiuhui, an analyst at Great Wall Securities, based in Beijing.
"I expect the market to be unstable in the short term," Zhang said.
The slimness of the gains suggests the market could take a turn for the worse in coming days, said Linus Yip, a strategist with Shanghai Securities in Hong Kong.
"We are going into a critical time window," Yip said. "The momentum is not good enough to push the market to a higher level. The diminishing turnover suggests a retrenchment may be coming."
Japan's Nikkei 225 index traded in a narrow range, closing 0.2 percent lower at 9,156.92, while South Korea's Kospi gave up early gains, losing 0.2 percent to 1,943.22. Hong Kong's Hang Seng slipped marginally to 20,100.09, while Australia's S&P/ASX 200 added 0.4 percent to 4,383.40.
In China, the Shanghai Composite Index jumped 0.6 percent to 2,119.72 following reports Chongqing, a huge metropolis in southwestern China, plans to spend 1.7 trillion yuan ($236 billion) to upgrade its manufacturing sector.
Among individual stocks, Hong Kong-listed CNOOC Ltd., China's biggest offshore oil and gas producer, tumbled 3 percent after saying first-half profit fell 19 percent due to rising costs and a drop in production from an oil spill.
In Japan, heavy equipment makers fell. Hitachi Construction Machinery lost 3 percent and Komatsu Ltd. fell 2.8 percent.
Crude oil rose 77 cents to $96.74 per barrel in electronic trading on the New York Mercantile Exchange. The contract fell 4 cents to $95.97 per barrel in New York on Monday.
In currencies, the euro was trading at $1.2412, up from $1.2348 late Monday in New York. The dollar was nearly unchanged, at 79.42 yen from 79.43 yen.
Researcher Fu Ting in Shanghai contributed to this report.