Kospi Surges 6.2 Percent as Asia Gains on Fed Decision Day

Asian stocks rose on Wednesday as chip shares carried Seoul and Tokyo higher hours before the Federal Reserve's interest rate decision, while India fell against the trend under the weight of high oil prices.

South Korea's Kospi jumped about 6.2 percent to just under 6,000 points. SK Hynix rose about 7 percent early and more later in the session after reporting a record operating profit of 83.3 trillion won, and Samsung Electronics surged 8.5 percent ahead of its own earnings on Thursday. Japan's Nikkei 225 rallied 1.3 percent to 64,094.51, with chipmaker Kioxia Holdings up 9.6 percent ahead of its results on Friday. Taiwan's Taiex gained 1.8 percent and Australia's S&P/ASX 200 added 0.4 percent to 8,889.10. The Shanghai Composite edged 0.5 percent higher to 3,666.50. Hong Kong's Hang Seng fell 0.7 percent to 23,041.32 in morning trade, the other laggard alongside India.

In Mumbai the move ran the other way. The Sensex fell 684 points, or 0.93 percent, to 72,914 in early trade, and the Nifty lost 167 points, or 0.74 percent, to 22,581. Every sector index traded lower except autos. The Nifty IT index dropped 3.2 percent. Traders blamed crude above 100 dollars a barrel, a heavy cost for the world's third largest oil importer, and caution before the Fed decision. Foreign investors had bought a net 4,240 crore rupees of Indian shares on October 27, while domestic institutions sold 1,250 crore.

All eyes on the Fed

The Fed ends its two day meeting on Wednesday with a statement at 2 p.m. Eastern. Market pricing points to no change, holding the federal funds rate at 3.75 to 4.00 percent, with a rate increase in December now in play. Bond yields rose across the region as traders waited. The 10 year Treasury yield added 2.45 basis points and the 30 year yield reached 5.3275 percent. Japan's 10 year yield rose 4.1 basis points and Australia's rose 4.6 basis points.

Higher yields pressed on gold. Spot gold traded about 0.5 percent lower near 4,040 dollars an ounce. Oil rose instead. West Texas Intermediate gained 1.4 percent to 101.33 dollars a barrel and Brent added 1.4 percent to 115.45 dollars, as traders focused on supply risk after Saudi Arabia said it had contained a fire near its Ras Tanura export terminal following an attack.

The regional picture is a split one. Chip earnings strong enough to move whole national indexes are pulling North Asia up, while oil importers in South Asia pay for crude priced off a war. The Fed's language on Wednesday will set the next move for both.