Asia close: PBoC to maintain slightly loose policy

Most stockmarkets in the Asia-Pacific region saw the day out with small gains, as traders waited on the result of Thursday´s meeting of G7 central bankers and finance ministers together with speeches from two US rate-setters scheduled during New York trading hours and on Friday.

Japan´s Nikkei-225 ended the session up by 0.09% to 16,772.46 alongside gains of 0.26% for the Shanghai Stock Exchange´s Composite Index, which rose to 2,822.44. Hong Kong´s Hang Seng was also to be seen higher, closing 0.14% higher at 20,397.11.

Nevertheless, traders appeared to be jumpy with some market commentary referencing the upcoming almost side-by-side US Federal Reserve and Bank of Japan policy meetings as a source of angst.

Indeed, after the close of trading in Tokyo dollar/yen registered a sudden spike lower, with traders apparently at a loss to explain the reasons behind the move. Some 'market chatter' referenced remarks from Japan´s vice-minister of finance for international affairs Masatsugu Asakawa to the Financial Times as the trigger. Asakawa reportedly said direct intervention in FX markets was still an option.

Acting as a backdrop, reports coming out of the G7 meetings in Sendai were somewhat contradictory.

Japanee prime minister reportedly warned his peers of the risk of a crisis ensuing along the lines of the one that followed the bankruptcy of Lehman Brothers in 2008. For some analysts that was an indication that Abe would announce that the consumption tax hike due to take effect in April 2017 would be pushed out.

However, the country´s top spokesman had denied one such previous report.

For his part, finance minister Taro Aso reportedly said the tax increase would still go ahead.

India´s benchmark BSE Sensex paced gains in the region, jumping 1.88% to end the day at 26,366.68. S&P´s BSE 100 index gained 130.74 points to finish at 8,170.77, its first close above 8,000 points in seven months.

Shares in engineer Larsen & Toubro led the advance in Bombay, soaring 14% after the compay reported better-than-expected first quarter figures.

South Korean and Taiwanese equities on the other hand slipped lower as their respective currencies gained the upper hand against the US dollar.

New Zealand´s All index advanced 0.42% to 1,318.45 alongside a gain of 0.28% to 5,451.92 for Australia´s All Ordinaries, amid gains in comodity prices.

The People's Bank of China said it would maintain a slightly loose policy to support the economy, Reuters reported citing local media.

The rate of growth of money supply measured through M2 was likely to slow in the coming months, the report said.

It was a light day in terms of macroeconomic data.

A gauge of Japan´s corporate services prices advanced at a 0.2% year-on-year pace in April, as expected in markets and unchanged from the previous month´s pace. However, it was well below the reading of 0.6% one year ago.

Regional US Federal Reserve president James Bullard was set to deliver a speech, alongside governor Jerome Powell on Thursday and followed by Fed chair Janet Yellen herself the next day.