TEMPO.CO, Sydney - Asia shares inched ahead while oil fell for the second session on Tuesday, August 23, 2016, as investors awaited guidance on whether the Federal Reserve will raise U.S. interest rates this year.
MSCI's broadest index of Asia-Pacific shares outside Japan added 0.3 percent in slow trade. South Korea, Australia, and Shanghai all gained.
Japan's Nikkei went the other way and eased 0.2 percent as the yen held firm on the dollar.
A survey of Japanese manufacturing activity showed signs of steadying in August as output rose for the first time in six months, but had little impact on stocks.
The IHS Markit/Nikkei Japan Flash PMI rose to 49.6 in August from a final 49.3 in July. More flash surveys are due from Europe and the United States later in the day.
The whole world seems to have hushed ahead of comments from Fed Chair Janet Yellen at the central bank's annual meeting in Jackson Hole on Friday. Investors still doubt the stars will align for a hike anytime soon, so a hawkish tone from Yellen would challenge that equanimity.
"Ever so slowly, the market does seem to be reluctantly acknowledging the chorus of senior Fed speakers who have suggested recently that a 2016 rate hike is still quite probable and September is 'live'," wrote analysts at ANZ in a note.
"But in reality, the response has been very muted."
Indeed, U.S. Treasuries actually rallied on Monday, with 10-year yields at 1.54 percent after falling 4 basis points overnight.
Fed fund futures imply around a 24 percent chance of an easing in September, rising to around 50 percent by December.
A quarter-point hike is not fully priced until September 2017.
REUTERS
