Asian equities slipped to the lowest in nearly two years on Tuesday, before trimming losses, as investors fretted about the toxic cocktail of rising interest rates and weaker economic growth.

The global stock markets have been on a tempestuous ride this year, with Wall Street suffering another rout on Monday as tech-rich Nasdaq slumped more than 4 percent while the S&P 500 ended below 4,000 points for the first time since March 2021.

"Ultimately, our view is that each and every time the U.S. Federal Reserve seeks to raise rates, the economy and growth will break and send us back to square one," said Peter Esho, co-founder at Wealthi, an investment property platform.

U.S. stock markets dived late last week after the Federal Reserve raised interest rates by a half-percentage point and flagged more aggressive hikes ahead to tackle decades-high inflation.

Across Asia, share indexes recovered from the day's losses. The Nikkei lost 0.4 percent, Australian shares shed 1.1 percent, Korean stocks lost 0.5 percent.

MSCI's Asian benchmark fell to the lowest since early July 2020. Hong Kong's benchmark share index returned from a one-day holiday sharply lower on Tuesday and slumped more than 4 percent before halving losses.

Oil prices retreated again on demand worries as China, the top oil importer, tightened up measures to contain the coronavirus pandemic.

Brent crude fell 0.9 percent to $105 a barrel and U.S. West Texas Intermediate crude declined 1 percent to $102 a barrel, adding to a 6 percent slump in the previous session. Both contracts are still up about 35 percent so far this year.

(With input from agencies)