Asian stocks closed mixed on Wednesday, as investors turned cautious amid weak energy prices ahead of the Federal Reserve rate decision.
Tokyo’s Nikkei Index led all gains, rising 125.98 points or 0.7% to 16,903.02. Japanese stocks were supported by expectations for additional stimulus by the Bank of Japan, which will meet again on Friday to decide future policy. According to analysts, there’s a strong chance the Japanese economy entered recession in the third quarter, putting more pressure on BOJ policymakers to expand their stimulus program.
Stocks in mainland China closed sharply lower, with the Shanghai Composite Index falling 1.7% to 3,375.20. The CSI 300 Index, which tracks stocks traded on the Shanghai and Shenzhen exchanges, declined 1.9%.
Hong Kong’s Hang Seng Index fell 1861.6 points or 0.8%. stocks
European stocks were trading higher Wednesday on expectations the United States Federal Reserve would keep rates unchanged. The pan-European STOXX 600 Index was up 0.4%.
In commodities, oil prices rebounded modestly after a sharp selloff at the start of the week. The West Texas Intermediate (WTI) benchmark for US crude rose 29 cents or 0.7% to $43.49 a barrel on the New York Mercantile Exchange. Brent crude, the international benchmark, rebounded 35 cents or 0.8% to $47.16 a barrel on ICE Futures Europe.
Expectations for continued low-rate stimulus by the Fed weighed on the US dollar in mid-week trading. The dollar index, a weighted average of the greenback against six key currencies, fell 0.2% to 96.77.
Gold, which often traded inversely with the dollar, rebounded $6.60 to %1,172.40 per troy ounce.
The dollar was trading lower against the euro, which attempted a rally after five days of general weakness. The EUR/USD exchange rate climbed 0.3% to 1.1074.
In economic data, a forward-looking indicator of German confidence declined for a third consecutive month, as economic expectations and willingness to make big purchases declined. The GfK consumer confidence index fell to 9.4 in November from 9.6 the previous month, matching forecasts.
The German government will release official inflation figures for October on Thursday. In EU-harmonized terms, German consumer inflation is forecast to rise 0.1% annually after falling 0.2% in September.
The European Commission will also report on euro area inflation on Friday. Consumer prices in the 19 nations sharing the euro is forecast to improve to zero in October from -0.1% in September.