Asian shares dip as investors await China data, Fed
Shares in Asia fell on Tuesday despite another record high close for the S&P 500, as investors await a U.S. Federal Reserve policy decision for clues of whether it will continue to take a "patient" approach to interest rate policy.
Shares in Asia fell on Tuesday despite another record high close for the S&P 500, as investors await a U.S. Federal Reserve policy decision for clues of whether it will continue to take a "patient" approach to interest rate policy. Traders were also cautious ahead of readings on China`s factory activity (0100 GMT), hoping for more signs that the world`s second-largest economy is starting to stabilise in response to a flurry of stimulus measures.
MSCI`s broadest gauge of Asia-Pacific shares outside Japan was off 0.1 percent, weighed by weakness in Korean shares <.KS11>, which fell 0.4 percent. Australian equities fell 0.3 percent, while New Zealand`s benchmark S&P/NZX 50 index <.NZ50> rose 0.3 percent.
Japan`s financial markets remain closed for a national holiday as Japanese Emperor Akihito prepares to abdicate on Tuesday in favour of his elder son, Crown Prince Naruhito. Asia`s wobbly open followed cautious gains on Wall Street overnight that nevertheless lifted the S&P 500 index to an intraday record high of 2,949.52. The index finished up 0.11 percent at a record closing high of 2,943.03.
The Nasdaq <.IXIC> gained 0.19 percent to 8,161.85, also a record closing high, and the Dow Jones Industrial Average <.DJI> eked out a 0.04 percent gain to 26,554.39. The quiet start to the week in global equity markets comes ahead of a two-day meeting of the policy-setting Federal Open Market Committee. The committee is set to release its latest statement at 2 p.m. EDT (1800 GMT) on Wednesday.
The Fed is widely expected to leave interest rates unchanged, as it seeks to balance robust economic growth against low inflation. In the latest slew of data sending mixed signals to the Fed, U.S. consumer spending rose at the fastest pace in more than 9-1/2 years in March, but core personal consumption expenditures (PCE), the bank`s favoured inflation measure, logged its smallest annual rise in 14 months.
"We expect the dovish tone from central banks to continue for the foreseeable future. Given evidence of a recovery in growth, this is very positive for risk assets," analysts at ANZ said in a morning note. Investors will also be watching manufacturing data in China, which is expected to show a steady but modest expansion in activity for April.
The yield on benchmark U.S. 10-year Treasury notes
Currency markets remained quiet. The dollar was barely changed against the yen at 111.65
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