The MSCI's broadest index of Asia-Pacific shares outside Japan eased 0.3%, dragged lower by a 0.5% fall in Australian shares, which scaled a 21-month high on Friday. A fall in overnight US equities on discouraging US factory orders and euro zone jitters spurred more profit-taking after a 6% rally so far this year.
South Korean shares opened down 0.8% while Japan's benchmark Nikkei stock average also opened 1.4% lower, after scaling a 33-month high on Monday.
Spain's opposition party on Sunday called for Prime Minister Mariano Rajoy to resign over a corruption scandal, an allegation Rajoy denies, pushing Spanish 10-year bond yields to six-week highs.
In Italy, 10-year Italian government bond yields hit their highest since late December, as chances of former prime minister Silvio Berlusconi regaining power raised worries about Rome's ability to fix its fiscal problems.
"Markets have been increasingly comfortable with European risks over the past few months and are largely not positioned for this increase in political problems. The outcomes in Spain and Italy are far from certain and may represent stumbling blocks for further expansion in risk appetite," Barclays Capital said in a research note.
The euro traded at $1.3507, retreating further from Friday's 14-1/2-month peak of $1.3711, ahead of the European Central Bank's policy meeting on Thursday.
US stocks slid on Monday, leaving the Standard & Poor's 500 Index at its worst day since November after the index rose just 60-odd points away from its all-time intraday high of 1,576.09 on Friday. European shares plunged on Monday as investors locked in profits on indexes trading close to multi-year highs.
The yen also took a breather, firming from lows against a broad range of currencies.
The dollar was down 0.2% to 92.20 yen after scaling its highest since May 2010 of 93.185 on Monday, while the euro fell 0.3% to 124.52 yen, off its loftiest since April 2010 of 126.97 hit on Friday.
On Monday, the yen plunged to its lowest since August 2008 against both the Australian dollar, at 97.07 yen, and the New Zealand dollar at 78.80 yen. The Australian dollar traded at 96.28 yen and the New Zealand dollar was at 77.70 yen on Tuesday.
"Markets are broadly undergoing a correction and the euro is definitely facing profit-taking, given the pace of its climb. Worries about the euro zone debt crisis always remain a downside risk for the euro, and could push it lower to $1.32-$1.33," said Hiroshi Maeba, head of FX trading Japan at UBS in Tokyo. "But the trend is still upward for dollar/yen, cross/yen. The dollar could reach 95 yen by the end of the month."
As long as markets hold out expectations for the Bank of Japan to implement aggressive monetary easing to beat decades of deflation in Japan, the yen will stay pressured. Any correction to the dollar's rise against the yen was also be seen as shallow, with many traders and analysts seeing a firm floor around 87-88 yen.
The Reserve Bank of Australia will announce its rate decision at 0330 GMT. The RBA is likely to leave its cash rate steady at 3.0%, having just cut in December, but any surprise move could expose the Australian dollar to sharp swings. It was at $1.0442.
US crude futures eased 0.2% to $96 a barrel.
