Indian shares led gains in Asia on Wednesday after a surprise rate cut by the Reserve Bank of India. The rest of the region saw a mixed trading picture as a strengthening Japanese currency and worries over sluggish growth in Australia and China damped sentiment.
Overnight, U.S. stocks pulled back from recent highs, closing lower in light volume trade as investors weighed soft auto sales and looked ahead to domestic data. The blue-chip Dow Jones Industrial Average and S&P 500 closed down 0.5 percent each, while the tech-heavy Nasdaq finished down 0.6 percent at 4,979 after topping the 5,000 mark for the first time since March 2000 on Monday.
ASX slips 0.5%
Australia's S&P ASX 200 index drifted lower, reeling from the impact of the Reserve Bank of Australia's decision to hold interest rates steady on Tuesday.
All the big four lenders were lackluster: Commonwealth Bank of Australia and Westpac closed down 0.9 percent each, while National Australia Bank and Australia & New Zealand Banking shed 0.5 and 0.4 percent. Big miners like Rio Tinto and Fortescue Metals (ASX:FMG-AU) lost 3.7 and 5.4 percent each.
On the domestic data front, Australia grew 2.5 percent on-year in the October-December period, in line with Reuters estimates. The Australian dollar briefly hit $0.7796 following the gross domestic product (GDP), but has since rebounded back to $0.7814 against the dollar.
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Indian shares up
Indian bourses were on a roll after the Reserve Bank of India announced a 25-basis-point cut in its repo rates ahead of the market open. The repo rates will be reduced to 7.5 percent from 7.75 percent, effectively immediately.
The CNX Nifty index halved gains, but remained trading near all-time highs close to the 9,000 mark. The Indian rupee (Exchange:INR=) briefly hit 61.65 against the dollar, but has since jumped back to 61.92.
Mainland indices
China's Shanghai Composite index closed up 0.5 percent after wavering between gains and losses following data that showed growth in the country's service sector.
Blue-chip stocks were mixed; brokerages including Citic Securities (Shanghai Stock Exchange: 30-SZ) and Haitong Securities (Shanghai Stock Exchange: 837-SZ) receded 0.8 and 0.5 percent, respectively, while Bank of China (Shanghai Stock Exchange: 1988-SZ) led losses in the banking sector, down nearly 2 percent, on news that the lender has seized control of London's Grosvenor House from its Indian owner and appointed an administrator to begin marketing the property for sale.