Investing.com - Shares in China on Wednesday shrugged off a decision by MSCI to not list China's A shares in widely followed index and Tokyo rebounded as investors saw recent falls as an opportunity to buy.
Chinese stocks reversed an earlier decline with the Shanghai Composite edging up 1.28% after the China Securities Regulatory Commission said MSCI's decision earlier to delay including A-shares in its emerging markets index won't change the direction of China's capital market reform towards a more market- and rule-based system. Hong Kong's Hang Seng Index edged up 0.07% to 20,402.37.
The yuan fell to its weakest level in over five years against the dollar Wednesday morning after the People's Bank of China set the fixing at the lowest level since January 2011, following the spot yuan's slump late Tuesday at 6.6001 compared with Tuesday's midpoint of 6.5791.
The Nikkei 225 rose 0.72%, while the S&P/ASX 200 fell 0.29%.
In Australia, the Westpac consumer sentiment index for June dipped 1%, a sharp reversal from the previous reading of 8.5%.
"The Reserve Bank (of Australia) Board next meets on July 5. A move at that meeting is highly unlikely. The key considerations for the bank are around the outlook for inflation," said Westpac senior economist Matthew Hassan. "On its current forecasts the RBA does not expect inflation to return to the bottom of the band until 2017, and that is on the assumption of a further rate cut, given that the Bank's forecasts are based on 'market pricing' for rates. The most important and immediate information about whether the RBA's May assessment is correct will come from the June quarter inflation report, which prints on July 27, after the July Board meeting but ahead of the August 2 meeting. It is our assessment that the information in this report will confirm to the board that another cut is indeed necessary."
Overnight, U.S. stocks pared sharp declines on Tuesday, extending recent losses, as yields on 10-Year German Bunds moved into negative territory for the first time in history and mounting Brexit concerns rattled global markets, spilling over into the major indices.
Investors continued to keep a close eye on developments in the U.K., as voters reportedly shift sentiments to the "Leave" campaign in next week's controversial Brexit referendum. An online poll from TNS said the Leave vote widened its lead over a vote to Remain by a 47-40 margin, as Rupert Murdoch's Sun newspaper backed a campaign to depart from the European Union. A slew of major world leaders including U.K. prime minister David Cameron, Germany chancellor Angela Merkel and International Monetary Fund managing director Christine Lagarde have issued stark warnings in recent weeks on the ramifications a British departure from the EU could have on the global economy at large.
The Dow Jones Industrial Average fell 57.52 or 0.32% to 17,674.96, while the NASDAQ Composite index lost 4.89 or 0.10% to 4,843.55, building off Monday's losses.
At session lows, the Dow fell as much as 130 points. The S&P 500 Composite index, meanwhile, dropped 3.74 or 0.18% to 2,075.32, even as six of 10 sectors closed in the green. Stocks in the Telecom and Utilities industries led, each gaining more than 0.45% on the session. Stocks in the Financials sector lagged, plunging 1.29% on the day.