Asian Stock Market: Bulls and bears jostle over covid, stimulus with eyes on Fed

• Asia equities keep trading mixed on hopes of overcoming the virus, US stimulus battle uneven vaccinations.
• Japan’s Retail Trade jumps the most since October 2020, Aussie Q1 CPI disappoints.
• Pre-Fed trading lull put a bid under the US dollar, Powell’s press conference will be the key.

Asian shares remain mixed for the third consecutive day of the week as traders look for clear direction amid complex economic signals and cautious sentiment ahead of today’s US Federal Reserve (Fed) meeting. It should, however, be noted that the US dollar benefits from the market’s fear that Fed Chair Powell may not be able to defend future inaction this time.

MSCI’s index of Asia-Pacific shares outside Japan drops 0.22% intraday while Japan’s Nikkei 225 gains 0.30% as buyers attack 29,100 level by the press time. Further, Australia’s ASX 200 gains 0.44% while New Zealand’s NZX 50 marks 0.15% losses on a day ahead of Wednesday’s European trading session.

While five-month high Japan Retail Trade might have backed Nikkei 225, Aussie traders seem to ignore downbeat Q1 CPI and Fitch’s fear over stimulus withdrawal. Moving on, NZX 50 might have troubled between the moves in Australia and the pre-Fed caution as it prints mild losses without any major catalysts of its own.

Elsewhere, China recovers early-week losses at a gradual pace while markets in South Korea stay offered, in contrast to Indonesian shares that print small gains by the press time.

Above all, Indian markets become the biggest winner of the region as global policymakers stay ready to offer further help to New Delhi as it battles the pandemic.

On a broader scale, US President Joe Biden tries to sell his upcoming stimulus measures, likely to be unveiled late on Wednesday. That said, the coronavirus (COVID-19) vaccinations are uneven and the doubts over the AstraZeneca jabs prevail after the first death in Canada due to the blood clotting issue.

Amid these plays, S&P 500 Futures rise 0.15% intraday while the US 10-year Treasury yield catches a breather around 1.62% after rising the most in six weeks the previous day. Further, the US dollar index (DXY) extends recovery moves with 0.15% intraday gains.

Read: S&P 500 Futures portray cautious optimism ahead of the Fed

Looking forward, the Fed isn’t likely to offer any hints of tapering while keeping the monetary policy unchanged. However, market players will be interested in seeing Powell’s defense of the US central bank’s current policies.