- POSTED: 12 Dec 2013 18:05
- UPDATED: 12 Dec 2013 19:07
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Asian markets eased on Thursday, following a lead from Wall Street, as investors turn their focus to next week's Federal Reserve policy meeting with speculation growing that the bank will announce a cut to its stimulus programme.
HONG KONG: Asian markets eased on Thursday, following a lead from Wall Street, as investors turn their focus to next week's Federal Reserve policy meeting with speculation growing that the bank will announce a cut to its stimulus programme.
And while a bipartisan budget deal in Washington fuelled hopes that another government shutdown will be avoided next month, it is believed that it will give the Fed more room to wind down the bond-buying scheme.
Tokyo fell 1.12 per cent, or 173.24 points, to close at 15,341.82, while Seoul slipped 0.51 per cent, or 10.04 points, to 1,967.93 and Sydney ended 0.82 per cent, or 41.7 points, lower at 5,062.5.
Shanghai closed flat, dipping 1.37 points to 2,202.80, while Hong Kong lost 0.51 per cent, or 120.12 points, to end at 23,218.12.
In other markets, Taipei fell 0.86 per cent, or 72.44 points, to 8,361.33 and Manila shed 2.14 per cent, or 126.21 points, to close at 5,762.53.
Bangkok slid 0.96 per cent, or 13.14 points, to 1,356.21, Jakarta fell 1.39 per cent, or 59.53 points, to 4,212.218 and Kuala Lumpur dived 0.49 per cent, or 8.95 points, to 1,833.87.
Mumbai fell 1.16 per cent, or 245.80 points, to 20,925.61 and Singapore dropped 0.06 per cent, or 1.70 points, to 3,059.04.
With few other catalysts to drive business, dealers are playing a wait-and-see game ahead of the Fed's policy announcement next week, with opinion split on whether it will begin reeling the stimulus in this month or early next year.
The Fed's $85 billion a month scheme has been credited with fuelling a global equities rally this year as it has supplied vast sums of cheap money to investors.
A series of strong recent data -- including falling unemployment and strong economic growth figures -- have strengthened the argument for a December cut, while this month a top Fed official indicated a small reduction could be on the cards.
Added to that was Tuesday's Democratic-Republican two-year budget deal which, if passed by Congress, would avert a shutdown crisis such as the one that paralysed Washington in October.
Wall Street's initial reaction to that deal was a sell-off, with the Dow losing 0.81 per cent, the S&P 500 off 1.13 per cent and the Nasdaq down 1.40 per cent. Analysts said the indexes were also subject to profit-taking after enjoying immense rallies this year.
On forex markets, the dollar edged up to 102.79 yen in afternoon trade, against 102.40 yen in New York on Wednesday.
The euro fetched US$1.3793, compared with US$1.3785, adding to four straight days of advances against the greenback. The single currency also fetched 141.80 yen compared with 141.19 yen.
In oil trade, New York's main contract, West Texas Intermediate (WTI) for January delivery, was up 16 cents at US$97.60 in afternoon trade while Brent North Sea crude for January added 19 cents to US$109.89.
Gold fetched US$1,254.70 at 0810 GMT compared with US$1,256.40 late Wednesday.