Asian Shares Mostly Lower As Fed Signals December Rate Rise

Asian stocks were mostly lower on Friday after the Federal Reserve left rates unchanged but signaled further gradual increases in rates despite signs of a slowdown in the pace of growth in business investment.

Italian budget concerns also returned to the fore after the Italian government insisted it would stick with its plan to rapidly increase public spending.

Shortly after the European Commission published its pessimistic forecasts for Italy, the country’s Finance Minister Giovanni Tria said the numbers come from an “inadequate and partial analysis.”

Gold prices inched lower as the dollar strengthened against other major currencies. Oil markets remained weak on concerns over rising supply.

U.S. crude oil futures held flat in Asian trade after falling as much as 1.6 percent on Thursday to extend losses to a ninth straight session on concerns over rising inventories and economic uncertainty.

China’s Shanghai Composite index was down 0.8 percent as policymakers struggle to dispel stock market gloom with promises of tax cuts and more bank lending. Hong Kong’s Hang Seng index was down as much as 1.8 percent.

Chinese consumer price inflation and producer price inflation rose in line with expectations in October, official data showed.

Consumer prices in China were up an annual 2.5 percent in October, in line with expectations and unchanged from the September reading.

Producer prices climbed an annual 3.3 percent – matching forecasts and slowing from 3.6 percent in the previous month.

Japan’s Nikkei index was down 0.7 percent on profit taking after rallying 1.8 percent to hit a 2-1/2-week high the previous day following the U.S. midterm election results.

South Korea’s Kospi average was down 0.2 percent, Australia’s benchmark S&P/ASX 200 was declining 0.4 percent and New Zealand’s NZX-50 index was marginally lower.

Overnight, U.S. stocks ended mixed after the Fed signaled it was still on course to hike interest rates in December.

The Dow Jones Industrial Average inched up marginally, while the S&P 500 slid 0.3 percent and the Nasdaq Composite shed half a percent.

European markets also ended mixed on Thursday after the European Union warned of slowing growth across the single currency bloc.

The pan-European Stoxx Europe 600 index gained 0.2 percent. The German DAX dropped half a percent and France’s CAC 40 index slipped 0.1 percent while the U.K.’s FTSE 100 rose 0.3 percent.