Asian markets rally stutters, focus turns to Fed meeting

Equities were mixed in Asia on Wednesday as investors appeared to run out of steam after an extended rally fuelled by economic recovery hopes as coronavirus restrictions are eased around the world.

While the World Health Organization said a record number of new virus cases were registered globally on Monday -- with Latin America, India and Russia heavily affected -- European nations pressed ahead with easing strict lockdowns that have likely sent the planet into recession.

Among the latest moves, Cyprus welcomed its first tourist flights in almost three months, while France announced the Eiffel Tower would re-open on June 25.

Investor focus is on the end of the Federal Reserve's policy meeting later in the day, the first since the United States began to re-open and Friday's blockbuster jobs report.

The bank's decision will be closely watched, though most observers do not expect it to further ease monetary policy, having pledged vast sums of cash as a backstop to financial markets.

"The relentless rebound in equity markets continues to endure, suggesting no one is willing to call a top," said AxiCorp's Stephen Innes.

"But the primary question remains: has the market's recovery bought the Fed some time not to use all its bullets, or will they keep the pedal to the metal?"

He added: "The Fed orchestrated this market recovery, and (is) now set to offer its latest thoughts, estimates and, hopefully for market sentiment, an actionable go-forward plan."

Tokyo, Sydney, Mumbai, Seoul, Taipei and Bangkok were all in positive territory, but Shanghai, Manila, Jakarta and Wellington were lower.

Hong Kong inched down after seven days of gains, while troubled airline Cathay Pacific ended lower, having soared almost 19 percent at the open a day after announcing a multibillion-dollar government-led bailout plan.

London, Paris and Frankfurt were all well up soon after the open.

The US rally stuttered with the Dow and S&P 500 dropping on Tuesday as observers begin to worry that the surge since March's troughs across markets may have gone too far.

"It would be no great surprise to see a period of market consolidation now as investors await decisive news on the coronavirus front to determine the direction of the next big market moves," Paul O'Connor at Janus Henderson Investors said.

The lingering optimism provided support to higher-yielding, riskier currencies, with the South Korean won and Australian dollar up 0.5 percent against the dollar, while the Chinese yuan edged up 0.3 percent.

Tokyo - Nikkei 225: UP 0.2 percent at 23,124.94 (close)

Hong Kong - Hang Seng: FLAT at 25,049.73 (close)

Shanghai - Composite: DOWN 0.4 percent at 2,943.75 (close)

London - FTSE 100: UP 0.7 percent at 6,378.06

West Texas Intermediate: DOWN 2.3 percent at $38.05 per barrel

Brent North Sea crude: DOWN 1.9 percent at $40.42 per barrel

Euro/dollar: UP at $1.1361 from $1.1336 at 2050 GMT

Dollar/yen: DOWN at 107.31 yen from 107.73 yen

Pound/dollar: UP at $1.2758 from $1.2729

Euro/pound: DOWN at 88.90 pence from 89.04 pence

New York - Dow: DOWN 1.1 percent at 27,272.30 (close)

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