HONG KONG (AFP) - Asian markets were mixed on Wednesday following a strong lead from Wall Street, with investors biding their time as they await the end of a crucial Federal Reserve policy meeting.

With few other trading cues, the main focus is on the Fed meeting, which is expected to see policymakers begin reeling in the bank's massive stimulus programme.

Tokyo rose 1.35 per cent, or 193.69 points, to 14,505.36, while Shanghai added 0.29 per cent, or 6.29 points, to 2,191.85. However, Sydney ended 0.25 per cent lower, shedding 13.1 points, to 5,238.1 while Hong Kong eased 0.27 per cent, or 63.07 points, to 23,117.45. Seoul was closed for a public holiday.

While economists tip the Fed to announce a taper of its US$85 billion (S$107 billion) a month bond-buying scheme - known as quantitative easing (QE) - the big question is how much it will be cut by.

"Most investors expect some kind of start to the tapering of the central bank's US$85 billion a month bond-buying programmes," Monex market analyst Toshiyuki Kanayama told Dow Jones Newswires. "A modest paring back is the most likely scenario, but few players are willing to place significant bets in any one direction."

Reduction forecasts range from US$5 billion to US$15 billion, and Mr Michael James, managing director of equity trading at Wedbush Securities, said a larger taper "might cause a little bit of market weakness. Anything else is priced in".

Global markets have focused intently on the Fed's plans for its stimulus, which has been credited with fuelling a huge investment spree. Emerging economies - particularly India and Indonesia - have suffered a flight of foreign cash since Fed boss Ben Bernanke in May said the US economy was showing signs of strength that meant QE could be wound in.