GLOBAL MARKETS-Asia shares cautious ahead of Fed, corporate earnings

By Swati Pandey and Chibuike Oguh
SYDNEY/NEW YORK, April 29 (Reuters) - Asian shares were
cautiously higher on Wednesday as investors paused ahead of the
U.S. Federal Reserve's policy decision while oil prices jumped
on hopes demand will pick up as many countries lift some of the
coronavirus-related restrictions.
In early Asian trade, MSCI's broadest index of Asia-Pacific
shares outside Japan .MIAPJ0000PUS added 0.2% for its third
straight day of gains.
Japan's markets were closed for a public holiday.
Australia .AXJO climbed 0.2% and South Korea .KS11 rose
0.3%. New Zealand shares .NZ50 slipped 0.6%.
"The market narrative remained centered around recent
competing themes with stimulus and reopening flagged as large
tailwinds...accompanied by concerns about behavioural changes in
the household and corporate sectors weighing on growth," said
Matthew Sherwood, head of investment strategy at Perpetual.
"We remain concerned to the extent that Fed liquidity can
offset systemic risks in credit markets."
Markets were looking for any forward guidance from the U.S.
Federal Reserve, which is due to issue a policy statement at the
close of its two-day meeting on Wednesday. The European Central
Bank meets on Thursday. Analysts said it was unlikely the Fed would make further
major policy moves, given the scope and depth of its efforts to
counter the economic damage caused by the coronavirus.
On Wall Street overnight, investors dumped tech giants
despite an earnings beat from Alphabet Inc's Google GOOGL.O ,
driving all three major U.S. stock indexes into the red.
The Dow Jones Industrial Average .DJI fell 0.3%, the S&P
500 .SPX lost 0.5% and the tech-heavy Nasdaq Composite .IXIC
dropped 1.4%.
Investors are next eyeing earnings from the other major tech
firms - Facebook FB.O , Amazon AMZN.O and Apple AAPL.O .
"There was a big sector rotation as money left high value,
growth sectors in tech like Amazon and went to value and
cyclical sectors like energy, industrial, financials," said Tim
Ghriskey, chief investment strategist at Inverness Counsel in
New York.
Reassuring UBS earnings lifted European banks nearly 5%,
while Wall Street digested upbeat numbers from industrial
conglomerate 3M Co MMM.N , a maker of N95 respirator masks, and
drugmaker Pfizer Inc PFE.N .
In currencies, the dollar weakened against the Japanese yen
to 106.60 on concerns the coronavirus could spread further than
previously thought if businesses reopened prematurely. JPY=
The euro EUR= was up 0.2% at $1.0840 though the euro index
=EUR eased after Fitch cut Italy's credit rating to BBB-, just
one notch above "junk" status.
The dollar index =USD against a basket of currencies fell
0.1%.
In commodities, U.S. crude CLc1 jumped 9% to $13.44 per
barrel, and Brent LCOc1 was up 1% at $20.65.
U.S. crude was trading above $50 a barrel just in February.
Gold was a shade weaker at $1,706.32 an ounce. XAU=

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