TOKYO:Asian shares fell on Tuesday amid uncertainty about Senate runoffs in Georgia, which could have a big impact on incoming U.S. President Joe Biden's economic policies.

MSCI's broadest index of Asia-Pacific shares outside Japan fell 0.34%, pulling back from a record high hit in the previous session. Australian stocks fell 0.44%. Chinese shares erased early losses and rose 0.26%.

Japanese shares lost 0.25% after a media report that the government will curb business hours in Tokyo and surrounding cities from Thursday.

U.S. S&P 500 stock futures edged up 0.24%.

Oil futures rose slightly in cautious trade as investors awaited a meeting later on Tuesday where major crude producers are set to assess output levels for February.

In the United States, control of the Senate is at stake with Tuesday's dual runoff elections in Georgia.

A Democratic victory in both races could tip control of the Senate away from Republicans, but both contests are very tight and the results may not be immediately known, which could lead to a repeat of the chaotic vote re-counts after the U.S. presidential election last year.

"2021 starts with a bang with pivotal political and economic news for markets to digest. The undisputed highlight will be the result of the Senate seat run-off elections in Georgia," James Knightley, chief international economist at ING, wrote in a research memo.

"If the Democrats win both seats this should lead to the most substantial 2021 fiscal stimulus. Nonetheless, it could be the excuse for a near-term consolidation in risk markets after a strong post-election rally."

Uncertainty about the Georgia vote and worries about rising coronavirus infections sent Wall Street sharply lower on Monday.

The Dow Jones Industrial Average fell 1.27%, the S&P 500 lost 1.49%, while the tech-heavy Nasdaq dropped by 1.48%.

Outgoing Republican President Donald Trump's call to pressure Georgia's top election official to "find" votes to overturn his loss to President-elect Biden in the state as also unnerved some investors.

The House and the Senate are scheduled to certify Biden's election win on Wednesday, but some Republicans have pledged to vote against this and thousands of Trump supporters are expected to converge on the capital in protest.

The MSCI's broadest gauge of global stocks eased by 0.06% in Asia on Tuesday, also pulling back from a record reached in the previous session.

Increased risk aversion helped the dollar index rebound from a 2 1/2-year against a basket of major currencies, but moves were subdued at the start of the year.

The British pound bought $1.3570. Sterling was nursing a 0.7% decline from Monday as Prime Minister Boris Johnson ordered a lockdown to try and slow a fast-spreading coronavirus variant.

U.S. crude futures rose 0.23% to $47.73 a barrel, while Brent futures edged up by 0.12% to $5115 per barrel. Major oil producers will meet later on Tuesday to decide on output levels for February after talks broke down the previous day.

Gold was slightly lower. Spot gold fell 0.21% to $1,938.25 per ounce. [GOL/]