Asian stocks patchy as Fed weighs rate hike

Asian stocks patchy as Fed weighs rate hike

The share prices board in Tokyo on Tuesday. (AFP photo)
The share prices board in Tokyo on Tuesday. (AFP photo)

TOKYO — Asian markets were patchy on Tuesday in a sign of volatile trading ahead of US Federal Reserve and Bank of Japan policy meetings.

Japan's Nikkei 225 stock index fell 1.7% to 18,565.90 as the yen rose against the US dollar. Australia's S&P/ASX 200 fell 0.4% to 4,909.60 and Hong Kong's Hang Seng lost 0.2% to 21,274.37, while the Shanghai Composite fell 0.3% to 3,510.35. South Korea's Kospi was up 0.3% at 1,932.97.

The Stock Exchange of Thailand main index jumped 2.6% to 1,300.51.

The Jakarta composite index rose 0.8% to 4,374 and stocks in Singapore ended little changed, in line with Asian stocks. 

Malaysia and the Philippines retreated amid net foreign selling of 218 million ringgit (US$50.70 million) and 446 million peso ($9.42 million), respectively, stock exchange data showed.

Vietnam hit a one-week closing high. The country released late in the day a better-than-expected trade balance for November. 

Mixed economic data for Japan are keeping alive, though just barely, hopes for more stimulus from the Bank of Japan to help spur the recovery. But most economists do not expect such a move at the policy meeting that wraps up on Friday.

The Federal Reserve's last meeting of the year begins on Tuesday, and it is expected to raise interest rates for the first time in almost a decade on Wednesday. The Fed's key short-term interest rate has been near zero since Dec 16, 2008. A rate hike would signal confidence in the US economy, but some investors worry it may slow growth.

With the Fed meeting nearing, "we think that markets may turn cautious though a rate hike is already being priced in,'' Mizuho Bank Ltd. said in its daily market report. "The element of surprise may come from the Fed's rhetoric."

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