TOKYO (REUTERS) - Asian shares were treading water in early trade on Wednesday as crude oil futures steadied after a selloff, while a widely expected interest rate hike from the Federal Reserve underpinned the dollar.
MSCI's broadest index of Asia-Pacific shares outside Japan was a few ticks higher in early trade. Japan's Nikkei stock index edged down slightly, shrugging off data that showed Japanese core machinery orders rose a more-than-expected 5 per cent in October in a sign of resilient capital spending.
On Wall Street on Tuesday, the Dow Jones Industrial Average and the S&P 500 both notched record closing highs, though the Nasdaq Composite shed 0.19 per cent.
The dollar index, which tracks the greenback against a basket of six major rival currencies, edged down 0.1 per cent to 94.048 but remained not far from three-week highs touched on Tuesday.
The dollar was steady against the yen at 113.51, while the euro was also steady at US$1.1743. Bitcoin was up 1.2 per cent on the Bitstamp exchange at US$16,851. The Fed's two-day policy meeting will conclude later on Wednesday.
The US central bank is seen raising its benchmark rate to between 1.25 and 1.50 per cent, with investors also focusing on clues to the pace of tightening next year as inflation remains cool. Those decisions may be influenced by news on Tuesday that US wholesale inflation rose last month.
Consumer price index (CPI) data will be released later in the global session on Wednesday. Also on investors' radar screens was the outcome of an Alabama's Senate election, where Republican candidate Roy Moore, endorsed by US President Donald Trump, faced off against Democratic challenger Doug Jones.
"The election itself won't have a direct impact on currencies, but a victory for Moore is seen as making it easier for the administration to pass legislation," including tax reform, said Mitsuo Imaizumi, Tokyo-based chief foreign-exchange strategist for Daiwa Securities.
"In the meantime, it's hard to sell the dollar ahead of the Fed, although we might see 'buy-the-rumour-sell-the-fact' after the actual announcement," as investors lock in their gains, Mr Imaizumi said.
Crude oil futures steadied after facing profit-taking pressure when they surged to two-year highs in the previous session on an unplanned closure of the pipeline that carries the largest volume of North Sea crude oil.
Brent crude was yet to trade in Asia after shedding 2 per cent on Tuesday. US crude added 0.6 per cent, or 32 cents, to US$57.46, after slipping 1.4 per cent overnight.