Asian Shares Edge Higher as Markets Brace for Fed Rate Decision
Asian stocks made tentative gains as bond yields and oil paused ahead of the Federal Reserve's policy decision, with traders pricing a near-certain rate hike.
Asian equities opened Wednesday's session with cautious gains, ending a four-day losing streak as a surge in global bond yields and oil prices took a breather before the Federal Reserve's policy announcement later in the day.
MSCI's broadest gauge of Asia-Pacific shares outside Japan swung between small gains and losses before trading 0.2% higher, supported by a 0.8% advance in Korean stocks. S&P 500 e-mini futures added 0.1%.
The modest uptick in Asia followed a weak handover from Wall Street, where the S&P 500 fell 0.5% for a second straight session as the yield on the 10-year Treasury note climbed to its highest level since 2007.
In Asian hours, the 10-year Treasury yield eased 0.8 basis point to 4.9875%, after crossing the 5% threshold on Tuesday for the first time in three years. The move came ahead of the Fed's rate decision and a press conference by Chair Kevin Warsh.
Market pricing points to a near-certain increase, with the CME Group's FedWatch tool showing an implied 92.4% probability of a 25-basis-point hike, up sharply from 59.4% a week earlier.
The dollar index, which tracks the greenback against six major currencies, held near a two-week high at 99.656.
Crude prices retreated as Asian trading resumed, with Brent futures down 0.6% at $108.08 a barrel, giving back part of Tuesday's 2.9% jump. The earlier rally followed reports from shipping industry sources that crude loadings at Saudi Arabia's Red Sea export terminal at Yanbu had been suspended and that Riyadh had cancelled some cargo deliveries to European buyers.
Digital assets remained under pressure after the U.S. Senate voted down a bid to advance comprehensive cryptocurrency legislation backed by President Donald Trump. Bitcoin slipped 0.1% to $75,816.24, while ether lost 0.2% to trade at $2,403.27.