ASIA MARKETS: Asia Stocks Mostly Lower Ahead Of Fed Meeting

By Daniel Inman

Asian markets were mostly lower Tuesday ahead of the U.S. Federal Reserve's policy meeting, with Japan weighed down by a stronger yen.

Some of the largest moves were in China, where the Shanghai Composite lost 0.9% on the mainland, while Hong Kong's Hang Seng Index dropped 0.3%.

There were also sharp moves among Hong Kong banks as Wing Hang Bank Ltd. (0302.HK) soared 40% after announcing that its substantial shareholders had been approached for a possible stake sale in the lender. The news had a knock-on effect on other local financial companies -- most notably Dah Sing Banking Group Ltd. , which jumped 18.6%.

Tokyo started the day higher after coming back online after a Monday public holiday, only to lose its early gains as the session progressed. The Nikkei was last down 0.3%, as it was weighed by a stronger yen.

Although the yen (USDJPY) weakened on Tuesday, it remained higher than at the end of last week. The dollar was at Yen99.21 compared with Yen99.05 late Monday in New York but still lower than Yen99.37 at the end of Friday.

Stocks and currencies across Asia rose Monday after Lawrence Summers pulled out of the race to replace Ben Bernanke as the next chairman of the U.S. Federal Reserve. As a result, the dollar weakened against regional currencies, as Summers had been seen as likely to push for a quicker reduction in the Fed's stimulus program had he become chairman.

Shares in convenience-store operator FamilyMart Co. (8028.TO) outperformed, rising 0.1% in Tokyo after a Nikkei report that the company's March-to-August group pretax profit rose to a fresh six-month high.

Also in Tokyo, pharmaceutical company Daiichi Sankyo (4568.TO) dropped 5.6% after news that the U.S. Food and Drug Administration is blocking imports of medicine made at the newest plant of India's Ranbaxy Laboratories, a Daiichi Sankyo subsidiary.

Malaysia's ringgit (USDMYR) also played catch-up after a holiday, with the currency bumping higher on Tuesday -- last at MYR3.2563 to the dollar compared with Friday's close of MYR3.2880.

More broadly, stocks were coming down from Monday's gains ahead of the Fed's policy meeting this week, where there are expectations that the central bank could roll back its bond-buying program.

The meeting is important as regional markets were subject to a number of selloffs in the summer, especially in Southeast Asia, as investors became worried that the Fed could change direction on stimulus.

 
   South Korea's Kospi   fell 0.6% and Indonesia's JSX  lost 0.3%. 
 

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