Asia report: Markets finish mixed ahead of Fed forecast

Markets in Asia finished in a mixed state on Wednesday, as investors closed their wallets ahead of the latest Federal Reserve forecast later in the global day.

In Japan, the Nikkei 225 was up 0.15% at 23,124.95 as the yen strengthened 0.36% against the dollar to last trade at JPY 107.37.

Fashion firm Fast Retailing managed gains of 0.23%, while among the benchmark’s other major components, robotics specialist Fanuc was down 2.11% and technology conglomerate SoftBank Group slipped 0.06%.

The broader Topix index lost 0.23% by the end of the trading day in Tokyo, closing at 1,624.71.

On the mainland, the Shanghai Composite was down 0.42% at 2,943.75, as the smaller, technology-heavy Shenzhen Composite rose 0.3% to 1,874.94.

Inflation in China missed expectations in May, according to fresh economic data out of Beijing, with the producer price index falling 3.7% year-on-year - a wider decline than the 3.3% expected by analysts polled by Reuters.

The National Bureau of Statistics said the consumer price index was up 2.4% year-on-year for the month, which was less than the 2.7% pencilled in by Reuters polling.

South Korea’s Kospi was ahead 0.31% at 2,195.69, while the Hang Seng Index in Hong Kong slipped 0.03% to 25,049.73.

The blue-chip technology stocks were mixed in Seoul, with Samsung Electronics down 0.18%, while chipmaker SK Hynix rose 1.11%.

Investor attention was very much turning across the Pacific by the end of the Asian day, ahead of the latest economic forecast from the US Federal Reserve, expected later on Wednesday.

“We fully expect that the Fed will be as dovish as necessary to avoid a mini ‘taper-tantrum’, keeping the peak-virus trade nicely on track,” said Oanda analyst Jeffrey Halley.

“That said, a deeper correction to the bull market run, notably on equities and oil cannot be ruled out.

“That though is simply due to the sheer weight of bullish positioning out there. Indeed, bullish open positioning on the S&P 500 is allegedly at record highs.”

Oil prices were lower as the region went to bed, with Brent crude last down 2.04% at $40.34 per barrel, and West Texas Intermediate off 2.41% at $38.00.

In Australia, the S&P/ASX 200 was up 0.06% at 6,148.40, with the hefty financials index dragging on the benchmark’s wider gains.

Among the big four banks, Australia and New Zealand Banking Group was down 1.14%, Commonwealth Bank of Australia lost 0.83%, National Australia Bank slid 1.51%, and Westpac Banking Corporation was 0.91% weaker.

Across the Tasman Sea, New Zealand’s S&P/NZX 50 fell 0.34% to 11,260.52, led lower by industrial products firm Skellerup, which was down 4.7%.

The down under dollars were both stronger on the greenback, with the Aussie last ahead 0.42% at AUD 1.4306, and the Kiwi advancing 0.44% to NZD 1.5283.