Asia-Pacific stocks mixed as data shows Japan's economy shrank less than expected in the first quarter

Elsewhere, mainland Chinese stocks closed lower, with the Shanghai Composite down 0.25% to 3,085.98 while the Shenzhen Component dipped 0.197% to around 11,208.08. The Hang Seng index in Hong Kong sat fractionally lower, as of its final hour of trading.

South Korea's Kospi finished the trading day 0.21% higher at 2,625.98. Australian stocks also saw gains as the S&P/ASX 200 climbed 0.99%, closing at 7,182.70.

MSCI's broadest index of Asia-Pacific shares outside Japan rose about 0.6%.

U.S. Fed Chair Jerome Powell said he will back interest rate increases till prices begin falling back toward a healthy level. Earlier in May, the U.S. central bank raised rates by half a percentage point —its largest hike in two decades — as it looks to fight inflation.

Overnight on Wall Street, the S&P 500 jumped 2.02% to 4,088.85 while the tech-heavy Nasdaq Composite surged 2.76% to 11,984.52. The Dow Jones Industrial Average gained 431.17 points, or 1.34%, to 32,654.59.

"The markets have had a nice run last night and that's largely because of the fact that .. on a year-to-date basis we have like six consecutive weeks of weekly losses, we have the biggest tech underweight since 2006 and we have the biggest equity underweight since May 2020," Kelvin Tay, regional chief investment officer at UBS Global Wealth Management, told CNBC's "Squawk Box Asia" on Wednesday.

"The market is actually poised for a rally but the big question is: is this a bear market rally or is this a sustainable rally going forward?," Tay said. "I think it's going to be hard for the rally to actually keep its legs given the fact that, you know, you have quantitative tightening happening in the next couple of weeks as well."

The U.S. dollar index, which tracks the greenback against a basket of its peers, was at 103.546 after a recent decline from levels above 104.

The Japanese yen traded at 129.15 per dollar, having held above the 129 level against the greenback for much of the week so far. The Australian dollar changed hands at $0.7006, as compared with an earlier high of $0.7046.

Oil prices were higher in the afternoon of Asia trading hours, with international benchmark Brent crude futures up 0.73% to $112.75 per barrel. U.S. crude futures climbed 1.06% to $113.59 per barrel.