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Asian stocks lower ahead of Fed meeting

Hong Kong - Asian markets mostly fell on Tuesday as a broadly positive lead from Wall Street was offset by caution before the US Federal Reserve's policy meeting.

Profit-takers moved in after Monday's gains, which were fuelled by the decision of fiscal hawk Larry Summers to quit the race to become the next Fed chairman.

Tokyo gave up early gains to end 0.65% lower, slipping 93.00 points to 14 311.67, and Seoul shed 0.39%, or 7.79 points, to 2 005.58.

Hong Kong gave up 0.31%, or 71.89 points, to finish at 23 180.52. Shanghai slipped 2.05%, or 45.84 points, to 2 185.56.

Sydney was almost unchanged, edging up 3.2 points to end at 5 251.2.

With few catalysts to drive buying, the focus is on the two-day Fed meeting that ends Wednesday. While investors expect policymakers to begin winding down the $85bn-a-month stimulus programme, the key question is the pace of the drawdown.

Global shares turned upwards on Monday after Summers withdrew from the running to replace Ben Bernanke as Fed boss.

The former treasury secretary is widely considered a monetary hawk who many feared would have overseen a brisk wind-down of the bank's bond-buying scheme, which has been credited with fuelling a rally in world markets.

The dollar fell to as low as ¥98.45 on Monday as dealers bet that the stimulus, which floods financial markets with cash, would remain in place longer without Summers in charge. However, it picked up in New York to end the day at ¥99.11.

In Tokyo on Tuesday it bought ¥99.20. The euro fetched ¥132.44 and $1.3348 compared with ¥132.20 and $1.3337.

Wall Street cheered the news about Summers, with the Dow finishing 0.77% higher and the S&P 500 up 0.57%. However, the Nasdaq fell 0.12% as Apple suffered another sell-off on disappointment over its latest iPhone models.

Oil prices fell as supply fears receded thanks to a US-Russia deal that may see Syria give up its chemical weapons and avoid an imminent US military strike.

New York's main contract, West Texas Intermediate for delivery in October, eased 59 cents to $106.00 in afternoon trade. Brent North Sea crude for November slipped 29 cents to $109.78.

Gold was $1 319.11 an ounce at 12:39 compared with $1 316.10 late Monday.

In other markets:

-- Taipei was flat, edging down 5.56 points to 8 249.78.

Hon Hai Precision fell 0.13% to Tw$75.9 while Taiwan Semiconductor Manufacturing Co was unchanged at Tw$105.5.

-- Wellington was also flat, edging up 4.40 points to 4 698.03.

Telecom rose 1.72% to NZ$2.36 and Fletcher Building was down 1.55% at NZ$9.50.

-- Manila rose 0.66%, or 41.43 points, to 6 344.14.

Ayala Land rose 2.17% to 28.25 pesos, while SM Prime Holdings advanced 2.36% to 17.38 pesos. SM Investments fell 1.24% to 795 pesos.

-- Jakarta ended down 0.10%, or 4.62 points, at 4 517.62.

Miner Aneka Tambang rose 0.68% to 1 470 rupiah, while cigarette maker Gudang Garam dropped 0.69% to 43 000 rupiah.

-- Kuala Lumpur gained 0.23%, or 4.14 points, to 1 774.94.

Malayan Banking added 0.59% to 10.18 ringgit while Malaysia Airline System shed 1.54% to 0.32 ringgit.

-- Singapore ended flat, edging up 0.05%t, or 1.44 points, to 3,180.92.

Oversea-Chinese Banking Corporation eased 0.88% to Sg$10.19 while agribusiness company Wilmar International was down 0.31% at Sg$3.22.

-- Bangkok also ended flat, slipping 0.09%, or 1.33 points, to 1 443.78.

Thai Union Frozen Products jumped 7.00% to 53.50 baht, while telecoms company True Corp. lost 3.61% to 8.00 baht.

-- Mumbai rose 0.31%, or 61.56 points, to 19 804.03.

Outsourcer Wipro rose 5.41% to 475.35 rupees while rival Tata Consultancy Services gained 2.38% to 1 947.05 rupees.


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