Asia shares mixed as traders watch Iraq, Fed meeting
People walk by an electronic stock board of a securities firm in Tokyo, Tuesday, June 17, 2014. Asian stocks were mixed on Tuesday as investors remained cautious ahead of a meeting by the Federal Reserve that’s expected to give an update on forecasts for the world’s No. 1 economy. AP PHOTO/KOJI SASAHARA
HONG KONG–Asian markets were mixed Tuesday, following a tepid lead from Wall Street ahead of a US Federal Reserve policy meeting, while oil edged down a touch from nine-month highs as traders nervously watch the crisis in Iraq.
The dollar nudged a little higher against the yen after the previous day’s sell-off but the uncertainty caused by events in the Gulf kept gains to a minimum.
Tokyo closed 0.29 percent, or 42.68 points, higher to finish at 14,975.97 after sinking more than one percent on Monday, while Seoul gained 0.40 percent, or 7.96 points, to 2,001.55.
But Sydney gave up 0.21 percent, or 11.6 points, to end at 5,400.7 while Shanghai slipped 0.92 percent, or 19.29 points, to 2,066.70. Hong Kong slid 0.42 percent, or 97.08 points, to 23,203.59.
With few economic catalysts to drive trade, Iraq has dominated investors’ attention as militants sweep across the country, taking over key cities and heading for Baghdad.
On Monday the jihadists battled government forces for control of a strategic northern town, while US officials considered using drone strikes against the rebels.
The fighting has raised fears over supplies of oil from Iraq, a key exporter, sending prices rocketing to highs not seen since September.
On Tuesday dealers cashed in some of those gains, although losses were limited. In the afternoon US benchmark West Texas Intermediate for July delivery fell 39 cents to $106.51 a barrel in afternoon trade, while Brent crude for August declined 42 cents to $112.52.
All eyes on Fed chief Yellen
On Wall Street the three main share indexes ended lower last week but edged up slightly Monday, helped by a better-than-expected rise in US industrial production.
The Dow was up 0.03 percent, the S&P 500 tacked on 0.08 percent and the Nasdaq rose 0.24 percent.
Attention will now turn to the Fed’s policy meeting that wraps up on Wednesday.
Expectations are for the bank to cut a further $10 billion from its monthly stimulus spending and keep interest rates at record lows. Investors are more interested in what chief Janet Yellen has to say about future policy.
Kathy Lien, managing director at BK Asset Management, said the Fed could tweak its forecasts for the year to trim its unemployment projection and raise its estimate for inflation.
If that happens, “Yellen will need to provide an explanation that convinces the market (the Fed) hasn’t gotten any closer to tightening,” Lien said. “If she fails, the US dollar and Treasury yields will rise.”
In afternoon Tokyo foreign exchange trade the dollar was worth 102.00 yen compared with 101.84 yen in New York.
The euro bought $1.3557 and 138.29 yen, up from $1.3570 and 138.20 yen.
Gold fetched $1,265 an ounce at 1045 GMT compared with $1,280 late Monday.
In other markets:
— Bangkok slipped 0.06 percent, or 0.83 points, to 1,471.02.
Coal producer Banpu lost 0.84 percent, or 0.25 baht, to 29.50 while Bangkok Bank fell 0.78 percent, or 1.50 baht, to 192.
— Manila closed 0.79 percent lower, shedding 53.52 points to 6,704.93.
Philippine Long Distance Telephone fell 0.14 percent to 2,846 pesos while Ayala Land tumbled 3.19 percent to 30.30 pesos.
— Mumbai rose 1.31 percent, or 330.71 points, to end at 25,521.19.
Jaypee Infratech rose 12.82 percent to 33.00 rupees while IRB Infrastructure Developers was up 7.82 percent to 209.60 rupees.
— Kuala Lumpur added 3.02 points, or 0.16 percent, to 1,874.60.
Sime Darby gained 0.21 percent to 9.55 ringgit and Telekom Malaysia added 0.32 percent to 6.23, while Malayan Banking slipped 0.10 percent to 9.81 ringgit.
— Jakarta ended up 0.49 percent, or 24.06 points, at 4,909.52.
Asia Pacific Fibers gained 1.47 percent at 69 rupiah, while Bank Permata lost 0.37 percent at 1,330 rupiah.
— Singapore fell 0.48 percent, or 15.82 points, to close at 3,274.44.
SingTel eased 0.26 percent to Sg$3.85, while property developer CapitaLand added 0.63 percent to Sg$3.19.
— Taipei added 0.41 percent, or 37.67 points, to 9,240.6.
Taiwan Semiconductor Manufacturing Co. was 0.81 percent higher at Tw$125.0 while leading chip design house MediaTek gained 2.72 percent to Tw$510.0.
— Wellington rose 0.28 percent, or 14.70 points, to 5,193.50.
Fletcher Building was up 0.34 percent at NZ$8.96 and Telecom added 1.10 percent to NZ$2.75.
