As a new round of trade negotiations started in Shanghai, Trump tweeted that if he wins re-election in November 2020, the outcome could be no agreement or a harsher one.

MSCI's broadest index of Asia-Pacific shares outside Japan  fell 0.7% to the lowest since June 19.

India's broader NSE index fell 0.6% to 11,018.45 as of 0500 GMT, while the benchmark BSE index dropped 0.54% at 37,193.35. Both indexes were on track for their worst July since 2002.

Most sectors were trading in the red. The Nifty FMCG index  fell about 1%, while the Nifty bank and financials indexes fell about 0.5% each.

"Earnings continue to disappoint in this season as well, reinforced by slowdown commentary from companies across sectors," said Rajesh Cheruvu, chief investment officer at Validus Wealth.

Hero Motocorp saw a volatile morning, when the shares swung between gains and losses. The stock was last seen up 1.9%. India's biggest motorcycle maker reported a better-than-expected first-quarter profit, helped by a one-time gain.

Tech Mahindra Ltd fell as much as 5% after the company's profit missed estimates, bucking the trend of its larger rivals in the $180 million Indian IT sector.

Axis Bank was the other major loser on the NSE index due to weaker-than-expected earnings on higher provisions, with the stock falling as much as 5%.

Coffee Day Enterprises touched a fresh low, hitting the lower circuit for the second day with a 20% fall, after police retrieved the body of the cafe chain's founder, who was missing since Monday night and had reportedly committed suicide.

Among gainers, Yes Bank shares rose about 2.4%, while Zee Entertainment and Sun Pharma were up about 1.8% each.