Equity Markets Down On Expectations Of Hawkish Fed Hold

Markets are cautious ahead of the Fed decision announced later today and are following US indices lower. MSCI APEX is down 0.8% today to be down 2.7% this week and Nasdaq futures 0.2% and S&P -0.1%. The USD index is slightly higher.

• China’s markets are down with CSI 300 and Shanghai comp -0.3%. The Hang Seng is 0.75% lower. Finance stocks are lower after the PBoC left prime lending rates unchanged today.
• In north Asia, Japan’s Nikkei is down 0.5%, Korea’s KOSPI is doing better down only 0.2% due to weakness in the electronics & electrical sectors, and Taiwan’s TAIEX -0.5%.
• The ASX is down 0.6%, driven by energy and mining stocks, to be 1.8% lower this week. NZX 50 is outperforming the ASX down only 0.1%.
• Jakarta is the outperforming in the region rising 0.7% but the rest of ASEAN is lower with Singapore down 0.2%, Thailand -0.6%, Malaysia -0.3% and Philippines -0.1%.
• India’s Nifty 50 is also lower down 0.8%.
• Later the focus is on the Fed decision. It is widely expected to leave rates steady (see MNI Fed Preview). There will also be a forecast update and press conference. An expected hawkish tone is already weighing on equity markets. On the data front UK CPI for August is released. The Bank of England meets tomorrow.