Asian markets mixed as Fed rate hike weighs on Wall Street

Regional stock markets presented a mixed picture in Thursday trading, with gains in Japan, South Korea, Taiwan and India offsetting losses in Hong Kong and mainland China. Japan's Nikkei 225 index edged up 0.2% to 64,067.53, while South Korea's Kospi advanced 0.9% to 6,778.49. Taiwan's Taiex recorded stronger gains of 1.3%, and India's Sensex rose 0.3%. However, Hong Kong's Hang Seng declined 0.7% to 24,533.46, and Shanghai's Composite index fell 0.4% to 3,877.46. Australia's S&P/ASX 200 managed a modest 0.3% increase to 8,718.20.

Wall Street's reaction to the Federal Reserve's decision triggered the broader regional volatility. The S&P 500 dropped 0.5% on Wednesday, with the Dow Jones Industrial Average falling more sharply at 1.2%. The technology-focused Nasdaq composite remained largely flat. The Fed's quarter-point rate increase represents its first hike in three years as the central bank continues efforts to curb US inflation that remains above its target level.

Market analysts indicated the Fed's decision aligned with prevailing expectations, suggesting the modest muted reaction reflected investor anticipation of the outcome. The rate increase brings the Federal Reserve's key benchmark rate to a target range of 3.75%-4.00%. US stock futures were trading higher in the aftermath, signalling potential recovery in coming sessions.