Asia stocks: Nikkei, KOSPI hit record highs on AI cheer; Australia dips on hot CPI

Investing.com-- Asian stocks were mixed on Wednesday, with major markets buoyed by record closing highs on Wall Street, while Australian shares fell after quarterly inflation readings reduced chances of further rate cuts by the Reserve Bank of Australia.

Markets’ focus was squarely on the U.S. Federal Reserve policy meeting, expected to end with a rate cut later in the day.

Major Wall Street indexes closed at all-time highs overnight, while futures tied to them were largely unchanged as of 03:06 GMT.

Nikkei, KOSPI hit record high on AI optimism

Japan’s Nikkei 225 jumped more than 2% to a fresh record high of 51,311.47 points, while the broader TOPIX index was largely unchanged.

Chipmakers and artificial intelligence-related stocks led gains, with Nvidia (NASDAQ:NVDA) rising 5% overnight after saying it will build seven new AI supercomputers for the U.S. Department of Energy.

South Korea’s KOSPI jumped as much as 1.7% to an all-time high of 4,078.99 points. SK Hynix (KS:000660) surged after posting a record third-quarter profit, driven by strong demand for high-bandwidth memory (HBM) chips used in AI servers.

In Japan, sentiment was further supported by a new U.S.-Japan rare earths agreement signed during former President Donald Trump’s visit to Tokyo.

In trade talks, focus was now on Trump’s visit to South Korea, where he is expected to meet Chinese President Xi Jinping to finalize a framework to avert new tariffs and sanctions.

China’s blue chip Shanghai Shenzhen CSI 300 rose 0.5%, while the Shanghai Composite gained 0.3%.

Meanwhile, Hong Kong’s Hang Seng index edged 0.3% lower.

Elsewhere, Singapore’s Straits Times Index fell 0.3%, while futures tied to Nifty 50 ticked 0.2% higher.

Fed meeting underway; Australia Q3 CPI jumps above forecasts

Investor attention remained fixed on the U.S. Federal Reserve’s meeting, which concludes later on Wednesday.

Markets widely expect a 25-basis-point rate cut, but traders are keen for signals on how far the central bank might go with further easing and whether it will adjust the pace of quantitative tightening.

Major U.S. tech companies, including Microsoft (NASDAQ:MSFT) and Alphabet (NASDAQ:GOOGL), are also due to report quarterly results later in the day. 

Australia’s S&P/ASX 200 fell 0.8%, underperforming after third-quarter inflation data dampened expectations for near-term policy easing.

Headline consumer prices rose 1.3% in the quarter, while the trimmed mean -- the Reserve Bank of Australia’s preferred measure -- climbed 1.0%, pushing the annual rate to 3.0%.

The figures prompted traders to push back bets on a November rate cut, with markets now pricing the next move closer to year-end.

"Even a February cut is far from certain now, given the size of the upside surprise this quarter," Westpac analysts said in a note.