Asian equities held steady on Wednesday, while the dollar traded near a four-month high as investors await the Federal Reserve's upcoming policy statement for clues on the future pace of US monetary tightening.

Share Market Live

NSE

MSCI's broadest index of Asia-Pacific shares outside Japan was little changed, while Japan's Nikkei eased 0.2 percent and South Korea's KOSPI slipped 0.3 percent.

Stephen Innes, head of trading in Asia-Pacific for Oanda in Singapore, said that in addition to focusing on the Fed's policy statement, equity investors may be turning cautious on the outlook for corporate profits, given potential cost pressures from recent rises in oil prices.

Market participants may be starting to wonder that "perhaps this is as good as it's going to get," Innes said, referring to corporate profits.

On Wall Street, the S&P 500 gained 0.25 percent on Tuesday on positive comments by US Trade Representative Robert Lighthizer on China, and Mexico's economy minister on the renegotiation of the North American Free Trade Agreement. Apple's shares rose about 4 percent after the closing bell. The company beat revenue and profit expectations in its March quarter, with its shares ending the regular session up 2.3 percent.

Technology sector results so far – at least from the likes of Amazon, Alphabet, Microsoft, Samsung and SAP – have broadly beaten forecasts for the first quarter, and overall aggregate US earnings growth is tracking seven-year highs of almost 25 percent.

The dollar's index against a basket of six major currencies traded near a four-month high set on Tuesday, with the dollar having surged into positive territory for 2018 ahead of the US Federal Reserve's policy decision due on Wednesday.

The Fed is seen set to hold interest rates steady this week but will likely encourage expectations that it will lift borrowing costs in June on the back of rising inflation and low unemployment.

Investors have all but priced out the chance of a rate hike at the end of the Fed's two-day policy meeting on Wednesday, particularly given its adherence in recent years to only raising rates at meetings that are followed by news conferences.

The central bank is due to announce its decision at 2 p.m. EDT (1800 GMT) on Wednesday. Fed Chairman Jerome Powell is not scheduled to hold a news conference.

The dollar held near a four-month high against a basket of major currencies, buoyed by the outlook for a strong US economy and rising yields amid signs of slowdown elsewhere, especially in Europe.

The dollar index last traded at 92.437. On Tuesday, it had risen to a high near 92.57, its highest level in nearly four months.

Against the yen, the dollar struck its highest level in nearly three months at 109.92 yen in early Asian trade and was last down 0.1 percent at 109.79 yen.

The euro held steady at $1.1997, not far from Tuesday's low of $1.1981, the common currency's weakest level since Jan. 11.

The benchmark US 10-year Treasury yield eased about 1 basis point in early Asian trade to 2.970 percent.

That came after the US 10-year Treasury yield rose 4 basis points on Tuesday, as bond prices came under pressure ahead of a quarterly refunding announcement.

The US Treasury is scheduled to announce its findings from a refunding survey on Wednesday, with analysts projecting an increase in auction sizes, or new issuance at different points on the yield curve.

Oil prices slid on Tuesday as the dollar remained near a four-month high, but worries that US President Donald Trump will pull out of the Iran nuclear deal underpinned the market.

US West Texas Intermediate crude for June delivery settled down nearly 2 percent on Tuesday, at $67.25 a barrel.

Spot gold last stood at $1,307.14. On Tuesday gold had slid to a four-month low of $1,301.51 as the dollar strengthened.