Asia markets trade mixed as investors look ahead to Fed meeting conclusion

SINGAPORE — Asia markets were mixed on Wednesday, after U.S. equities tumbled overnight in another volatile session as investors await the Fed meeting statement later stateside.

Japan markets traded little changed as the Nikkei 225 inched down 0.15% in early trade, while the Topix was flat.

Over in South Korea, the Kospi rose 0.63%.

Markets in Australia and India are closed for holidays on Wednesday.

Meanwhile, the International Monetary Fund downgraded its global growth forecast for this year as rising Covid-19 cases, supply chain disruptions and higher inflation hamper economic recovery. It said in a report published Tuesday that it expects global gross domestic product to weaken from 5.9% in 2021 to 4.4% in 2022 — with this year’s figure being half a percentage point lower than previously estimated.

Stocks stateside tumbled following a volatile session on Monday. The Dow Jones Industrial Average closed down Tuesday, shedding 67.77 points, or 0.2%, to close at 34,297.73. The index swung from a nearly 819-point deficit at its lows to a roughly 226-point rally at its highs during the session. The S&P 500 dipped 1.2% to 4,356.45. The technology-heavy Nasdaq Composite fell 2.3% to 13,539.30.

The U.S. dollar index, which tracks the greenback against a basket of its peers, was at 95.948, continuing to rise from earlier levels of around 95.8.

Kathy Lien of 60 Second Investor said that the path of U.S. monetary tightening, if aggressive, could set the pace for the dollar to strengthen.

“If Powell confirms that rate hikes will begin in March and suggests that they need to aggressively control inflation with more than 4 rounds of tightening, the U.S. dollar should soar against all of the major currencies,” she said in a note. “However anything short of that could trigger a relief rally in equities and currencies that eases demand for U.S. dollars.”

In other currencies, the Japanese yen traded at 113.85 per dollar, while the Australian dollar was at $0.7155, strengthening from around $0.714 earlier.

— CNBC’s Karen Gilchrist contributed to this report.