Asian shares were mostly lower Wednesday despite a rally on Wall Street after virtual talks between President Joe Biden and China's Xi Jinping.

Japan's benchmark Nikkei 225 fell 0.4 per cent to 29,688.33. South Korea's Kospi fell 1.2 per cent to 2,962.42. Australia's S& P/ASX 200 lost 0.7 per cent to 7,369.90. Hong Kong's Hang Seng fell 0.4 per cent to 25,621.91, while the Shanghai Composite edged up 0.5 per cent to 3,537.32. The online talks between Biden and Xi late Monday U.S. time appeared to signal a step in the right direction but they did not yield any major steps toward resolving longstanding disputes over trade and other issues. "Any concrete development from the meeting still awaits to be seen, but the amiable approach thus far in addressing issues from both parties pares down the risks of political tension in markets," said Yeap Jun Rong, market strategist at IG in Singapore. Stocks closed higher on Wall Street as investors reviewed solid earnings reports from big retailers and a surprisingly strong report on consumer spending.

The government reported that Americans largely shrugged off higher prices last month and stepped up their spending at retail stores and online. The Commerce Department said retail sales rose 1.7 per cent in October. That's the biggest gain since March and up from 0.8 per cent in the previous month.

The S&P 500 index rose 0.4 per cent, to 4,700.90 and is sitting just below the record it set on Nov. 8. The Dow Jones Industrial Average rose 0.2 per cent, to 36,142.22. The Nasdaq rose 0.8 per cent, to 15,973.86.

Technology stocks did much of the heavy lifting for the benchmark S&P 500, which had slightly more gainers than losers. Chipmaker Qualcomm rose 7.9 per cent.

A wide range of companies that rely on consumer spending made solid gains. Home Depot rose 5.7 per cent after the home improvement retailer reported surging sales and solid profits in the third quarter amid a hot housing market. The results also lifted competitor Lowe's by 4.2 per cent.

Several companies that depend on consumer spending rose. Online crafts marketplace Etsy rose 5.1 per cent. Nike rose 1.8 per cent while Coach and Kate Spade parent Tapestry gained 1.5 per cent.

The nation's largest retailer, Walmart, also reported solid financial results while raising its profit forecast, but the stock fell 2.5 per cent and gave back some of the big gains it's made in the last few weeks.

Several other large retailers will release their latest financial results this week. Target reports its results on Wednesday and Macy's reports results on Thursday.

Health care companies also rose. Communications companies and a makers of household goods and other consumer staples lagged the market.

Investors received another encouraging economic update from the Federal Reserve, which said industrial production rebounded in October with a 1.6 per cent gain. The gain followed a 1.3 per cent plunge in September.

Wall Street is closely monitoring the latest economic reports for more clues as to how businesses and consumers are dealing with rising inflation. Companies have been raising prices as they face higher raw materials costs and supply chain problems.

Consumers have been willing to pay the higher prices on many goods, though analysts are concerned that consumers could eventually pull back on spending because of inflation.

Heightened concerns over inflation tripped up the broader market last week following a strong run that lasted several weeks as companies reported mostly solid earnings. The latest round of earnings is nearing its finish and the market has very few singular events or economic reports to focus on through the end of the year.

In energy trading, benchmark U.S. crude fell 51 cents to USD 80.25 a barrel in electronic trading on the New York Mercantile Exchange. It lost 12 cents on Tuesday to USD 80.76 per barrel. Brent crude, the international standard, lost 47 cents to USD 81.96 a barrel. In currency trading, the U.S. dollar strengthened to 114.85 Japanese yen from 114.80 yen. It has been rising from the 110 yen level since September. The euro slipped to USD 1.1303 from USD 1.1322.