Japan Gains as Asian Stocks Drop Due to Caution – Asia Market Wrap

Stocks in Asia fell as traders braced for turbulence ahead of next week’s US election and Federal Reserve rate decision.

Benchmarks in mainland China and Hong Kong fell by more than 1%, leading losses in the region. The Topix and Nikkei indexes rose, helped by the Yen’s recent weakness and gains in the technology sector following the Nasdaq Composite’s record closing yesterday. US market futures rose in Asia after the S&P 500 closed up 0.2%.

A Dollar index fell after a three-day rally as traders awaited US GDP statistics due later Wednesday to assess the economy’s strength. Treasury yields were hardly changed.

In addition to the dangers posed by US events, Asian investors are focused on the BoJ’s decision on Thursday and a meeting of China’s top legislative body scheduled for November 4th-8th, during which additional fiscal stimulus may be revealed. Asia’s regional equities index is expected to have its worst monthly performance in a year.

Oil prices recovered following a two-day drop on the expectation of further easing of hostilities in the Middle East. Gold hit a new high early Wednesday as traders anticipated significant market disruptions ahead of the election. Bitcoin, regarded as a Trump trade, remained near an all-time high.