Asian stock markets traded mixed on Wednesday amid ongoing U.S.-Iran tensions and caution ahead of the U.S. Federal Reserve decision, while investors assessed strong inflation data from Australia.
Investor mood remained fragile after Wall Street closed lower overnight, pressured by a Wall Street Journal report that OpenAI had missed internal targets for users and revenue, raising doubts about the sustainability of heavy artificial intelligence spending.
U.S. stock index futures edged higher in Asian trading on Wednesday, as investors also await financial results from "Magnificent 7" companies.
Fed decision looms; oil remains elevated amid Hormuz disruption
Focus remained squarely on the Federal Reserve’s policy decision later in the day.
The central bank is widely expected to keep interest rates unchanged, but markets are watching for guidance on the timing of potential easing, particularly as inflation risks remain elevated amid rising energy prices.
Geopolitics also stayed front and centre. A Wall Street Journal report said U.S. President Donald Trump had instructed aides to prepare for a prolonged blockade of Iran, escalating tensions around the Strait of Hormuz.
Rising tensions helped keep oil prices elevated, fuelling inflation concerns and reinforcing caution across equity markets.
South Korea's KOSPI edged 0.2% higher, after hitting record highs in the previous session.
Japanese markets were closed for a public holiday.
Singapore's Straits Times Index fell 0.6%, while futures tied to India's Nifty 50 traded flat.
Hua Hong shares drop on report of US chip curbs
In China and Hong Kong, sentiment was mixed.
Shares of China's No. 2 chipmaker Hua Hong Semiconductor (HK:1347) fell more than 7% after a Reuters report flagged potential new U.S. curbs on shipments of chipmaking equipment, underscoring ongoing technology tensions.
However, broader Chinese and Hong Kong technology stocks remained relatively supported, with investors still encouraged by optimism around low-cost AI developments from DeepSeek, even as U.S. tech weakness spilled over globally.
China's Shanghai Composite index gained 0.4%, while the blue-chip Shanghai Shenzhen CSI 300 rose 0.7%.
Hong Kong's Hang Seng climbed 1%, with the Hang Seng TECH sub-index jumping 1.5%.
Australia Q1 CPI accelerates, stokes RBA hike bets
Australia's S&P/ASX 200 slipped 0.3% after data showed the country's consumer inflation accelerated sharply in the first quarter, reinforcing expectations that monetary policy will remain tight.
Headline consumer prices rose about 1.4% on the quarter, lifting annual inflation to around the mid-4% range, the highest level in more than two years.
The March monthly CPI indicator also showed a notable pickup, driven largely by a surge in fuel costs as oil prices climbed amid Middle East disruptions. Transport costs rose sharply, while housing and services inflation remained sticky.
The Reserve Bank of Australia has hiked rates twice this year and has warned of further increases due to rapidly rising inflation.
Source: Investing