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Asia stocks decline ahead of Fed meeting; Nikkei ends down 0.65%

Published 09/17/2013, 02:46 AM
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Investing.com - Asian stock markets were mostly lower on Tuesday, as investors looked ahead to the outcome of the Federal Reserve’s policy meeting on Wednesday, amid ongoing speculation over the timing of the central bank’s widely expected reduction in monthly bond purchases.

The Fed’s stimulus program is viewed by many investors as a key driver in boosting the price of global equities.

During late Asian trade, Hong Kong's Hang Seng Index inched down 0.35%, Australia’s ASX/200 Index ended 0.06% higher, while Japan’s Nikkei 225 Index ended down 0.65%.

Investors remained cautious ahead of the outcome of the Fed’ two-day policy meeting after a recent series of lackluster U.S. data raised doubts over whether the bank will announce plans to start rolling back its USD85 billion-a-month bond buying program.

Data released on Monday showed that the Empire State manufacturing index fell to a four-month low of 6.29 in September from a reading of 8.24 in August. Analysts had expected the index to rise to 9.2.

Market players have closely been looking out for U.S. data reports recently to gauge if they will strengthen or weaken the case for the Fed to reduce its bond purchases.

Fed Chairman Ben Bernanke has said that the decision to begin tapering will depend on whether economic data is strong enough.

In Tokyo, the Nikkei declined as investors positioned ahead of the outcome of the Federal Reserve’s latest policy meeting.

Index heavyweights Fast Retailing and Softbank saw shares fall 0.85% and 3.8% respectively.

Meanwhile, in Hong Kong, the Hang Seng gave back some of the previous session’s strong gains.

Gold producers Zijin Mining Group and Zhaojin Mining Industry Company declined 1.1% and 1.5% apiece as gold prices traded near a five-week low ahead of the Fed meeting.

On the upside, Wing Hang Bank surged 39% amid speculation the lender may soon receive a buyout offer.

Elsewhere, in Australia, the benchmark ASX/200 Index ended little changed after minutes from the Reserve Bank of Australia’s most recent policy meeting released earlier showed that it would maintain its easing bias but signaled no urgent need to act.

The big four banks were mostly higher, with National Australia Bank adding 1.7%, while ANZ Banking Group and Westpac Banking Group tacked on 1.45% and 1.05% respectively. Commonwealth Banking Group saw shares decline 0.6%.

Gold miners were lower, with Newcrest Mining Group and Kingsgate Consolidated tumbling 2.3% and 4.75%.

Looking ahead, European stock market futures pointed to a modestly lower open.

The EURO STOXX 50 futures pointed to a loss of 0.2% at the open, France’s CAC 40 futures dipped 0.2%, London’s FTSE 100 futures eased down 0.25%, while Germany's DAX futures pointed to a decline of 0.2% at the open.

The ZEW Institute was to release its closely watched report on German economic sentiment later Tuesday, while the U.S. was to release data on consumer price inflation.

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