Asian stocks closed mixed on Friday with investors digesting the US Federal Reserve's latest outlook suggesting the world's mightiest economy may have improved, but inflation remained a concern.
The outlook accompanied a Fed decision to hold its key interest rate at 5.25 percent and resulted in choppy trade on Wall Street, which ended the day mixed.
However, Asian trade came under additional pressure, with Shanghai slumping 2.39 percent amid a proposal for a special bond issue of up to US$200 billion to help fund a new foreign exchange reserve management agency and for an end or reduction of tax on bank interest income. This raised fears the government will mop up excess liquidity and divert funds away from equities.
PHOTO: AP
It also impacted on other regional markets with Taipei down 0.11 percent as Hong Kong fell 0.75 percent, Bangkok shed 0.11 percent and Seoul dropped 0.56 percent.
Tokyo had a solid day out with a 1.15 percent gain after a slew of economic data came in within expectations. Sydney was up 0.15 percent in volatile trading, while New Zealand rose 1.05 percent.
Elsewhere Jakarta, aided by a firmer local currency, surged 1.25 percent, while easing inflation pushed Mumbai up 1.01 percent as Kuala Lumpur rose 0.27 percent, Manila gained 0.56 percent and Singapore was up 0.28 percent.
TAIPEI
Share prices closed 0.11 percent lower after Wall Street's flat performance overnight in response to the US Federal Reserve's economic outlook.
The Fed, in maintaining US interest rates at 5.25 percent, said the US economy appeared to be growing at a moderate pace, but it also offered a cautious reading on inflation which held buying in equities back.
The weighted index closed down 9.62 points at 8,883.21 on turnover of NT$153.82 billion (US$4.69 billion).
Profit-taking continued to drag the local market, with financial stocks pointing the way downward. However, the tourism sector outperformed amid hopes the government will allow more Chinese tourists to visit the country.
President Securities (
"Riding on the New York lead, investors pocketed further profits following the previous rally," he said.
Different sectors have each taken corrective turns given the expected pressure around the 9,000 points level on the index.
"A market driven by ample liquidity usually features rotational plays. This has been the case for the domestic market recently," Lee said.
He added that liquidity-driven interest will continue to balance out profit-taking and technical pressure, with the index likely to hover in a narrow band going forward.
TOKYO
Share prices shot back above 18,000 points, closing up 1.15 percent as a weaker yen boosted exporters and a batch of economic reports met expectations.
The NIKKEI-225 index added 206.09 points to 18,138.36.
"The softer trend of the yen encouraged investors to scoop up exporters," whose earnings are expected to benefit, said Hideo Mizutani, chief strategist at Sieg Securities.
HONG KONG
Share prices closed 0.75 percent lower as investors cut positions in late trade following another weaker finish on mainland bourses.
Dealers said Chinese bourses were hit by continued concerns that authorities are aiming to steer liquidity away from the equity markets and this was enough to offset the impact of a new trade agreement signed by Hong Kong and China.
Hong Kong and China signed the accord as part of celebrations for the 10th anniversary of Hong Kong's return to Chinese rule today.
The Hang Seng Index closed down 165.49 points at 21,772.73.
SEOUL
Share prices closed 0.47 percent lower, reversing early gains, as investors sold off stocks amid fresh fears of a possible rate tightening here and in China.
The KOSPI index closed down 8.15 points at 1,743.60.
SHANGHAI
Share prices closed 2.39 percent lower, extending losses on continued fears that the government is determined to mop up abundant liquidity.
The Shanghai Composite Index closed down 93.50 points or 2.39 percent at 3,820.70.
SYDNEY
Share prices closed 0.15 percent higher on Friday after spending most of the final trading day of the financial year in negative territory.
The S&P/ASX 200 rose 9.3 points at 6,274.9.
SINGAPORE
Share prices closed 0.28 percent higher after the US Federal Reserve held its key interest rate unchanged and offered few hints about a future change.
The Straits Times Index closed up 9.97 points at 3,548.2.
KUALA LUMPUR
Share prices closed 0.27 percent higher as gains in select blue chips helped the key index to close in positive territory after a volatile session.
The composite index closed up 3.66 points at 1,354.38.
MANILA
Share prices closed 0.56 percent higher as fund managers built up portfolios in certain stocks in time for the closing of their books for the month.
The composite index added 20.23 points to 3,665.23.
MUMBAI
Share prices rose 1.01 percent, on improving global market trends after the US Federal Reserve kept key rates unchanged.
Dealers said sentiment also improved as India's inflation fell to a 14-month low, according to data released on Friday, easing pressure for a further interest rate hike.
The 30-share SENSEX index rose 145.94 points to 14,650.51.
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