Most Asian Markets Down Ahead of Crucial US Fed Reserve Meet

Most Asian markets traded lower on Friday as market participants exercised caution ahead of a key US Federal Reserve meeting, where the central bank could announce a reduction in its massive monthly asset purchases.

The Japanese Nikkei finished 0.12% higher or 17.40 points at 14,404.67.

Australia's S&P/ASX finished 0.44% lower or 22.90 points at 5,219.60.

South Korea's Kospi finished 0.49% lower or 9.74 points at 1,994.32.

India's BSE Sensex was trading 0.32% higher or 63.14 points to 19,845.02.

Hong Kong's Hang Seng was trading 0.34% lower or 77.95 points to 22,875.77.

The Shanghai Composite was trading 0.62% lower or 13.95 points to 2,241.66.

The Fed's FOMC will meet on 17-18 September. Market participants expect the central bank to provide clarity on the timing and size of the planned reduction of its $85bn a month bond-buying stimulus.

"The key question market participants are asking is by how much will the US Federal Reserve taper? And the answer seems to be somewhere around $10bn, effecting only longer term US treasury purchases, and not mortgage backed securities," said Tim Radford, global analyst at Rivkin Securities.

Elsewhere, in India, government data released on 12 September showed that industrial production bounced back in July just as consumer inflation eased in August, offering a much needed respite for the government. Industrial output rose 2.6% from a year ago, while retail inflation eased to 9.52% in August from 9.64 in the preceding month.

In Japan, media reports said the government is considering options including a 5tn yen ($50bn, €38bn, £32bn) spending package to cushion the planned sales tax hike.

Wall Street Down

On Wall Street, indices ended lower ahead of the crucial Fed meeting. "US stocks fell but declines were limited as investors took a break after seven consecutive sessions of gains," Radford said.

The Dow finished 25.96 points lower at 15,300.64, pulled down by JPMorgan and DuPont.

The S&P 500 closed 5.71 points lower at 1,683.42 while the Nasdaq ended 9.04 points lower at 3,715.97.

Government data released on 12 September showed that the number of Americans filing new claims for government-funded jobless benefits dropped to a more than seven-year low.

However, the latest and last major reading of the US labour market, ahead of the FOMC meeting, should be viewed with scepticism -- technical issues prevented two states from processing all the claims they received during the week ended 7 September, reported Reuters.

Despite the unprocessed claims, the data suggested the US labour market was on the recovery path and this could influence the Fed's monetary stimulus decision, expected on 18 September.

Company Stock Movements

In Shanghai, Shanghai International Port (Group) lost 4.6%.

Pharmaceutical companies Neptunus, Guilin Layn Natural and Lukang Pharmaceutical shed 2% each on news that authorities were probing a Chinese drugmaker for alleged corrupt business practices.

China Eastern Air jumped 6% while rivals Hainan Airlines and China Southern Air gained over 3%. A Goldman Sachs research not said that domestic airline stocks would benefit from the development of a free-trade zone in Shanghai.

In Hong Kong, gold miner Zhaojin Mining Industry fell 6.7% while rival Zijin Mining Group shed 3.8%, following lower gold prices.

In Tokyo, consumer electronics major Sharp lost 5% after it announced its $1.5bn public offering Camera maker Konica Minolta was down 4%.

Convenience store operator Seven & I Holdings inched up 0.7% on news that its consolidated operating profit for the six months ending 31 August could hit a record high.

Construction firms were among the most heavily traded stocks owing to the drawn out Olympic enthusiasm. The city will host the 2020 Olympic games.

Sumitomo Mitsui Construction shot up 4.6%. However, rivals Tekken and Daiho shed 1% and 0.7% respectively.

In Mumbai, India's biggest engineering and construction group Larsen & Toubro added 2.6%.

The country's biggest power equipment maker Bharat Heavy Electricals shot up 3.4%.

In Sydney, gold miner Medusa Mining tanked by about 8%. Kingsgate Consolidated lost over 7% Perseus Mining was down 5.7% and Newcrest Mining shed 2.8%.

Casino operator Crown added 1% following news that it won approvals from the Sri Lankan government to develop a hotel and resort on the South Asian island.

In Seoul, steel and auto parts maker Hyundai Hysco was down 3%. Hyundai Steel fell 3% while rival Posco lost 1%

Korea's second-largest carrier Asiana Airlines gained almost 2% after it said it plans to strengthen pilot training. One of its jets crashed in San Francisco in July.