A lackluster earnings performance for Asian firms in the second quarter also affected price valuations.

Valuations of Asian shares took a hit in August after a sharp sell-off due to an escalation of the United-States-China trade war.

A decline of 3.4 per cent in MSCI's broadest index of Asia-Pacific shares during August pulled down its forward 12-month price-to-earnings ratio to a three-month low of 12.78 times at the end of last month. The July level was 13.1.

A lackluster earnings performance for Asian firms in the second quarter - in which 55 per cent of companies in the region missed their consensus earnings estimates - also affected price valuations last month.

In a report last week, Goldman Sachs said its fresh 12-month target for MSCI Asia-Pacific ex-Japan is 515, or 1 per cent below the previous 520 expectation. "The difference is due to further downward revisions to our top-down earnings estimates," it said.

Goldman also said it maintains its target valuation of 12.9 times forward earnings, which accounts for its baseline scenario of no US-China trade deal until after the 2020 US presidential election.

Due to the fall in P/Es, regional shares were trading at steep discount to their global peers, Refinitiv data showed.

China, Hong Kong and South Korea were the lowest-cost shares in the region, with P/E multiples of about 11 or less.

India and Malaysia were the most expensive, with ratios of 15.98 and 15.84 respectively.