Asian markets showed cautious movement on Wednesday as traders monitored developments in U.S.-China trade discussions, with China signaling further support for domestic consumption while U.S. economic indicators suggested continued strength.
The MSCI Asia-Pacific index outside Japan rose 0.05%, while Japan's Nikkei fell 0.6%. Chinese shares gained 0.3% as Beijing announced plans to stimulate economic activity through tax cuts and infrastructure investment.
Australian stocks climbed 0.7% amid optimism about potential Chinese stimulus measures. However, the Australian dollar declined 0.6% after data revealed slower-than-expected economic growth in the fourth quarter.
U.S. economic data provided support for the dollar, with the non-manufacturing sector posting its strongest new orders since August 2005. Federal Reserve officials remained focused on the trajectory of trade negotiations between Washington and Beijing.
"Steady U.S. growth is a stronger theme than slowing Chinese growth, particularly with Sino-U.S. talks nearing a potential resolution," said Daiwa SB Investments economist Soichiro Monji.
U.S. Secretary of State Mike Pompeo indicated progress in trade discussions, stating the two nations were "on the cusp" of a deal but emphasizing the need for a "right" agreement. Beijing's 2019 economic growth target of 6.0-6.5% reflects cautious expectations amid global uncertainties.
Currency markets saw the dollar hold gains against the yen, trading at 111.775, while crude oil prices declined on rising U.S. stockpiles. Brent crude fell 0.85% to $65.31 a barrel.
