Hong Kong stocks up 0.18%

Hong Kong - Hong Kong stocks ended up 0.18% on Tuesday, as dealers await the end of the US Federal Reserve's closely watched two-day policy meeting.

The benchmark Hang Seng Index added 39.96 points to 22 846.54 on turnover of HK$59.62bn ($7.70bn).

While analysts widely expect the Fed to keep its $85bn a month stimulus programme in place, they will be poring over Wednesday's announcement for clues as to when it will start winding it down.

The bank had been expected to begin tapering by the end of this year but a weak set of data, including soft jobs growth, and this month's two-week government shutdown has made that highly unlikely.

Financial stocks closed broadly higher, with Agricultural Bank of China rising 3.16% to HK$3.59 while Bank of China gained 2.31% to HK$3.54 and China Construction Bank climbed 2.08% to HK$5.89.

Chinese shares closed down 0.23%. The benchmark Shanghai Composite Index slipped 5.01 points to 2 128.86 on turnover of 117.3bn yuan ($19.3bn).

"The sell-off on the Shenzhen startup ChiNext board led to declines in shares of smaller firms on the Shanghai market, but gains in blue chips like financial firms supported the market," Zheshang Securities analyst Zhang Yanbing told AFP.

"There's still upside room in the market given cheap valuations of blue-chip stocks," he added.

Paper mills and steel makers led the declines. Guangdong Guanhao Hi-Tech slumped by its 10% daily limit to 12.77 yuan, while Minfeng Special Paper dropped 3.82% to 6.29 yuan.

Hangzhou Iron & Steel tumbled 5.84% to 3.71 yuan and Chongqing Iron & Steel lost 4.26% to 2.47 yuan.

Banks bucked the trend. Industrial Bank gained 4.77% to 12.09 yuan while Pudong Development Bank rose 3.25% to 10.48 yuan.