Korea’s Kospi SEU, +0.04% closed up 0.04%, Australia’s S&P/ASX 200 XJO, +0.71% gained 0.7% and Hong Kong’s Hang Seng Index HSI, +0.04% climbed 0.04%. Taiwan’s Y9999, -0.15% slipped 0.1%.
Asian markets have been in lockdown so far this week, with the market widely assuming the U.S. central bank will raise rates, but with many traders wanting to avoid being caught out by a surprise Fed inaction. Investors are also waiting for guidance on the U.S. central bank’s plans for raising rates in 2017.
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Traders are cautious because there have been a lot of surprises this year including Britain’s decision—in June—to leave the European Union, said Margaret Yang, analyst at CMC Markets.
“It would be very disappointing if they hold the rate...unchanged,” she added.
The Fed’s decision, due early Thursday in Asia, is expected to unlock trading in the region.
“The Fed rate hike…it’s obviously going to drive the markets,” said Christoffer Moltke-Leth, director of global sales trading at Saxo Capital Markets. “This is something we’ve been waiting for all year.”
This would be the Fed’s second rate increase in just over a decade, ushering in a new era of rising inflation and possible heavy spending by U.S. President-elect Donald Trump.
Elsewhere, Japan’s Nikkei NIK, +0.02% closed about flat, as traders processed the Bank of Japan’s quarterly tankan survey, released Wednesday.
The survey showed that sentiment among large manufacturers rose to plus 10 over the three months to December from plus 6 in the previous quarter. A plus figure means the percentage of respondents saying business conditions are favorable exceeds those saying they aren’t.
Trump’s election has been a boon for Japan’s manufacturers. The yen has fallen more than 10% against the dollar to around ¥115 on expectations for Trump’s economic policies. Yen devaluation makes Japan’s exports more competitive in U.S. dollars.
However, the rebound in the tankan’s headline index will likely give the BOJ an excuse to refrain from further easing, said Marcel Thieliant, senior Japan economist at Capital Economics. The tankan also showed companies were cautious about capital-expenditure plans, but these predictions typically pick up toward the end of the fiscal year, he said.
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On the Hang Seng Index, energy stocks were among the biggest gainers. China Petroleum & Chemical Corp. 0386, +3.38% also known as Sinopec, closed up 3.4% on news that it planned to raise as much as $10 billion from an initial public offering of its gas-station and convenience-store business.
PetroChina’s share price 0857, +4.51% , meanwhile, rose on news Sinopec has agreed to sell a 50% stake in its Sichuan-to-East China gas pipeline for 22.8 billion yuan ($3.30 billion). The stock closed up 4.5% Wednesday, and has gained 10.1% over the past two days.
Sinopec’s deal is more significant for rival PetroChina, said Bernstein Research, saying that it believes the latter also intends to sell down its pipeline network over the next two years.
PetroChina’s pipeline assets are also much bigger than Sinopec’s.
Jefferies says PetroChina’s 72%-owned pipeline-asset unit has an appraised asset value of $41 billion, while the book value is just 87 billion yuan ($12.6 billion).
“We believe the market is giving PetroChina’s pipelines essentially no value. A large deleveraging through a pipeline divestiture should unlock substantial shareholder value, in our view,” Jefferies says.
— Joanne Chiu, Megumi Fujikawa, Takashi Nakamichi, Kosaku Narioka and Brian Spegele contributed to this article.