Trading thin in some markets ahead of FOMC meeting outcome
By V. Phani Kumar, Colin Ng & Kirsty Green
HONG KONG (MarketWatch) -- Asian stock markets advanced Wednesday, with many rebounding on the back of commodity shares amid soaring gold prices.
Trading volumes were thin in some markets as many investors stayed on the sidelines ahead of the results of the U.S. Federal Reserve's policy meeting. The Fed is widely expected to stand pat on rates, but investors are focused on any potential comments on the U.S. economic outlook and hints about when it could tighten policy.
Japan's Nikkei 225 Average rose 0.4% to 9,844.31 and Hong Kong's Hang Seng Index added 1.8% to 21,614.77, while China's Shanghai Composite stretched its winning streak to a fourth straight session, ending 0.5% higher at 3,128.54.
India's Sensex jumped 2.2% in afternoon trading, well on its way to snap out of a six-session losing streak, including a 3.1% tumble Tuesday. Taiwan's Taiex, finishing 2% up and South Korea's Kospi gained 1.9%, also ending higher for the first time in seven sessions.
Elsewhere, New Zealand's NZX 50 gained 0.2% and Philippines' main index ended flat, with Singapore's Straits Times Index up 0.9%, Thailand's SET Index rising 1.9% and Indonesia's JSX gaining 1% in afternoon trading.
The Dow Jones Industrial Average futures contract was 31 points higher in screen trade, after the DJIA (INDU 9,772, -17.53, -0.18%) ended off 0.2% Tuesday.
Gold miners were again in the limelight, after spot gold rallied to a record high of $1,089.10 per troy ounce in late New York trade Tuesday, helped by news of the Indian central bank's purchase of gold from the International Monetary Fund. Spot gold was at $1,085.80 per troy ounce, up $1.50 from the New York close.
Sumitomo Metal Mining Co. (JP:5713 1,439, -19.00, -1.30%) (STMNF 15.93, +0.03, +0.18%) shares rose 2.6%, outperforming the broad market in Tokyo, as did Newcrest Mining (NCMG.Y 31.35, +2.10, +7.18%) (AU:NCM 34.45, +1.07, +3.21%) and Lihir Gold (LIHR 30.25, +2.14, +7.61%) (AU:LGL 3.31, +0.14, +4.42%) in Sydney, finishing up 3.2% and 4.4%, respectively.
Shandong Gold-Mining (CN:600547 69.80, +1.44, +2.11%) rose 2.1% in Shanghai and Zhaojin Mining Industry Co. (HK:1818 14.40, +0.58, +4.20%) (ZHAOF 1.76, -0.17, -8.81%) added 4.2% in Hong Kong, with Zijin Mining Group Co. (CN:601899 9.48, +0.14, +1.50%) (HK:2899 8.21, +0.44, +5.66%) rising 1.5% in Shanghai and 5.7% in Hong Kong.
Barclays Capital said gold had broken out of its recent consolidation and was now heading for the $1,100 target.
The Australian market was unable to sustain early gains, after September retail sales came in lower than expected, dropping 0.2% from August, with ANZ Bank economist Alex Joiner saying retail sales will be soft for the rest of the year.
With no sign of a massive recovery in the labor market and wage growth muted, "households are going to be very cautious going into Christmas, with spending levels pared back from the artificially-boosted levels we got from the cash hand outs earlier this year," he said.
Woolworths (AU:WOW 27.90, -0.23, -0.82%) dropped 0.8% and Wesfarmers (AU:WES 26.74, -0.15, -0.56%) (WFAF.Y 12.14, -0.20, -1.61%) gave up 0.6%, though Westpac Banking Corp. (WBK 115.48, -0.69, -0.59%) (AU:WBC 25.80, +0.36, +1.42%) gained 1.4% as its full-year results were marginally ahead of expectations.
Tokyo's chip-related shares fell after Morgan Stanley's rating cut on the semiconductor industry, with Tokyo Electron (TOEL.Y 114.00, +1.50, +1.33%) (JP:8035 5,110, -130.00, -2.48%) slumping 5.1%.
In Hong Kong, oil producers were being supported by gains in crude-oil futures. Cnooc (CEO 151.79, -0.39, -0.26%) (HK:883 11.88, +0.34, +2.95%) rose 3% and PetroChina (PTR 122.77, +1.22, +1.00%) (HK:857 9.63, +0.33, +3.55%) advanced 3.6%, also helped by Credit Suisse's rating upgrade to neutral from underperform.
