Asian stocks mostly higher ahead of Fed’s interest rate decision

Asian stocks saw a mostly positive trend on Wednesday, as investors eagerly awaited the Federal Reserve's decision on interest rates, with many anticipating a rate hike for the first time in three years. Inflation remained elevated in the U.S., surpassing the Fed's target, driving expectations of a rate increase.

Despite losses on Wall Street, U.S. futures edged higher. Japan's Nikkei 225 rose 0.4% to 63,721.89, while South Korea's Kospi and Hang Seng gained 1.3% and 0.1%, respectively. Hong Kong's Hang Seng index increased by 0.1% to 24,700.62.

The Shanghai Composite index climbed 0.6% to 3,886.48. Companies involved in artificial intelligence experienced volatility due to calls from U.S. AI leaders to slow the development of the technology for safety reasons. SoftBank Group, a major investor in OpenAI, fell 1% after previously rising 7.5% the previous day. Chip equipment manufacturer Tokyo Electron rose 1.4%, while Kioxia Holdings saw a 2.9% drop.

South Korea's memory chipmaker SK Hynix climbed 2.9%, and Samsung Electronics increased by 1.9%. Taiwan's Taiex jumped 1.1%, with its leading AI chipmaker TSMC, or Taiwan Semiconductor Manufacturing Co., gaining 0.2%. Australia's S&P/ASX 200 added 0.3% to 8,694.20.

Rising U.S. Treasury yields, driven by the Iran war-induced energy crisis and growing national debt, applied pressure on the stock market. The 10-year Treasury was at 4.98% early Wednesday, up from its previous level of 5.04%. Meanwhile, the U.S. dollar strengthened to 155.36 Japanese yen from 155.10 yen, and the euro was trading at $1.1543, down from $1.1544.