Asian shares up

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SINGAPORE/NEW YORK- Asian stock markets eked out a 10th consecutive session of gains on Wednesday, but momentum ebbed as doubts about the global recovery from the pandemic returned ahead of the US Federal Reserve meeting.

The sideways moves in equities cap two weeks of stock market gains, turbocharged by Friday’s data showing a completely unexpected rise in US employment last month. Safe havens from gold to the Japanese yen won support as optimism ebbed.

MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.3 percent and Japan’s Nikkei rose 0.1 percent. The yen held on to two days of big gains and commodity currencies nursed Tuesday’s losses. Gold rose slightly.

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Focus has switched to the Fed’s economic outlook and whether a steepening of the US yield curve during last week’s bond market selloff might prompt intervention at longer tenors.

“The Fed tonight is a key variable in determining whether this is a pit-stop or U-turn,” said Vishnu Varathan, head of economics and strategy at Mizuho Bank in Singapore.

No action is expected from the Fed, but any hit of taking the foot off the pedal could hammer risk sentiment and lift the dollar.

The Fed’s economic projections, guidance as to how long and how low rates can be held down and the prospect of yield-curve control will be closely watched, Varathan said in a note.

A statement from the Fed is due at 1800 GMT followed by a news conference half an hour later and markets seem to be idling ahead of that. S&P 500 futures rose 0.6 percent to recoup some of Tuesday’s losses, but other moves were smaller.

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