Most Asian markets eased in Wednesday action as investors shifted their focus from the recently concluded U.S.-North Korea summit to the conclusion of the Federal Reserve’s June meeting later in the day.
Down Under, the S&P/ASX 200 declined 0.57 percent, with most sectors trading in negative territory. The heavily weighted financials subindex eased 0.67 percent and resource plays also pulled back. Utilities stocks rose more than 8 percent.
Greater China markets came under pressure. In Hong Kong, the Hang Seng Index lost 0.63 percent and on the mainland, the Shanghai composite edged down by 0.76 percent.
Japan’s Nikkei 225, however, bucked the trend to edge up by 0.43 percent, with shippers and real estate stocks leading gains. Automakers rose 1.05 percent.
MSCI’s broad index of shares in Asia Pacific excluding Japan pulled back by 0.49 percent in Asia afternoon trade.
Markets in South Korea and Indonesia were closed on Wednesday.
Global markets were subdued following Tuesday’s meeting between U.S. President Donald Trump and North Korean leader Kim Jong Un. The summit, which took place in Singapore, marked the first ever meeting between sitting leaders of the two nations.
The historic summit culminated in both leaders signing an agreement that pledged to create a lasting “peace regime” on the Korean Peninsula, although the statement was criticized for lacking in detail. Trump also said during a press conference that the U.S. would be halting war games held with South Korea.
“Until there is more meaningful progress, which could ultimately lead to potential alleviation of existing sanctions, we expect the Kospi to remain in this range [of 2,400 to 2,500]. Our base case Kospi remains at 2,600,” Morgan Stanley analysts said in a note.
Following the conclusion of the high profile summit, investors will now focus their attention on upcoming central bank meetings. The Federal Reserve will end its two-day meeting on Wednesday U.S. hours and is widely expected to announce a rate hike. Markets will also be looking for clues on the central bank’s rate hike trajectory this year.
“There’s a big risk that the FOMC probably raises its 2018 fed funds rate projections. Right now, they expect to raise rates one more time after the June meeting. There’s a potential risk they imply two more … but that’s not going to be a big shock to market participants,” Elias Haddad, at Commonwealth Bank of Australia, told CNBC’s “Squawk Box.”
The European Central Bank and Bank of Japan will meet later in the week.
The dollar index, which tracks the greenback against a basket of currencies, was supported ahead of the conclusion of the Fed’s meeting at 93.880. Against the yen, the dollar firmed slightly to trade at 110.61 at 1:12 p.m. HK/SIN.
In individual movers, shares of ZTE plunged some 40 percent in Hong Kong after resuming trade on Wednesday. Shares of the telecommunications equipment maker had been suspended since April after the U.S. government imposed a ban on the Chinese company from buying U.S. parts.
Elsewhere, shares of Australia’s APA Group rose 20.92 percent after the company received an indicative non-binding offer led by CK Infrastructure Holdings.
U.S. stocks finished the day little changed in the last session, with the lack of commitment in the agreement signed by Trump and Kim not giving investors much to go on.
