TOKYO- Asian shares were mixed on Wednesday as already high valuations discouraged investors from buying equities ahead of a closely-watched US Federal Reserve meeting.
MSCI’s broadest index of Asia-Pacific shares outside Japan declined 0.23 percent.
Australian stocks rose 0.55 percent, but shares in China slipped 0.44 percent. Stocks in Tokyo edged 0.16 percent higher.
S&P 500 e-mini stock futures rose 0.09 percent.
Fed Chairman Jerome Powell is expected to reaffirm that easy monetary policy will remain in place for a prolonged period and dismiss any suggestions of tapering bond purchases.
US President Joe Biden will also address a joint session of Congress, where he may make additional comments about infrastructure and stimulus spending.
These developments would normally be a positive for stocks, but analysts say so much economic optimism is already priced into the equity market that it is difficult to buy stocks further from current levels.
“We expect the Fed’s tone on the economy to be more positive than at the March FOMC meeting, reflecting the ongoing pickup in the data, but we don’t expect any substantive new signal yet on tapering,” analysts at TD Securities wrote in a research note.
“While we do not expect much price action due to the Fed decision, Biden’s remarks could continue to suggest more incoming supply, bear steepening the (Treasury yield) curve.”
The Dow Jones Industrial Average rose 0.01 percent, but the S&P 500 lost 0.02 percent, and the Nasdaq Composite dropped 0.34 percent as investors digested a mixed bag of earnings from Tesla Inc, 3M Co, Microsoft Corp, and Google-parent Alphabet overnight. – Reuters
