Asian markets mixed ahead of US Fed decision

AFP: Asian markets were mixed yesterday as investors focus on what US Federal Reserve chief Ben Bernanke has to say about the future of the bank’s stimulus scheme during a congressional hearing later in the day.

Profit-taking kept stocks in check following two days of broad gains, while Japan’s Nikkei ended higher on late buying as the dollar rose against the yen following a sell-off in New York.

Tokyo added 0.11 percent, or 15.92 points, to 14,615.04, while Seoul rose 1.13 percent, or 21.13 points, to 1,887.49 and Hong Kong gained 0.28 percent, or 59.49 points, to 21,371.87.

But Shanghai ended 1.00 percent lower, giving up 20.80 points to 2,044.92, while Sydney was flat, edging down 4.3 points to 4,981.7.

Bernanke will give his semi-annual testimony over two days in Washington from yesterday and investors will be looking for hints about the Fed’s view of the US economy and its plans on when to wind down its US $ 85 billion-amonth bond-buying scheme.

Also in the sights is a meeting of G20 finance ministers on Thursday and Friday in Moscow, where officials are expected to discuss the Fed’s stimulus, while Japan will hold upper house elections at the weekend.

Prime Minister Shinzo Abe’s Liberal Democratic Party is tipped to win the majority of the 121 seats up for grabs, giving him control of both chambers and the ability to push on with his aggressive monetary policy drive.

Wall Street provided a negative lead as profit-taking set in after the Dow and S&P 500 broke to new record highs for three consecutive sessions.

The Dow fell 0.21 percent and the S&P 500 gave up 0.37 percent. The Nasdaq shed 0.25 percent.

On forex markets the dollar sank in New York as traders tentatively await Bernanke’s comments, ending Tuesday at 99.04 yen.

But the unit made a comeback in Asia yesterday, climbing to 99.72 yen in the afternoon, while the euro bought US $ 1.3140 and 131.01 yen against US $ 1.3164 and 130.43 yen.

Oil prices eased, with New York’s main contract, West Texas Intermediate for delivery in August, down 60 cents at US $ 105.40 a barrel, while the new September contract for Brent North Sea crude shed 52 cents to US $ 107.62.