Asian stocks higher ahead of Fed meeting outcome

BANGKOK (AP) - Asian stocks were mostly higher Wednesday as investors fearful of a debt implosion in Europe held onto hopes that the Federal Reserve will announce measures to jolt the U.S. economy.

Benchmark oil hovered below $87 a barrel. The dollar fell against the euro and was stable against the yen.

Japan's Nikkei 225 index was marginally higher at 8,721.98 after the Finance Ministry released trade data showing the country's exports rose for the first time in six months. South Korea's Kospi gained 0.4 percent to 1,845.09.

Hong Kong's Hang Seng fell 0.3 percent to 18,964.83 as blue chip property developers and retailers slumped.

Australia's S&P/ASX 200, swinging between gains and losses, was up 0.5 percent at 4,061.70. Benchmarks in mainland China, New Zealand, Singapore and Taiwan were higher. Those in Malaysia and Indonesia fell.

Cameron Peacock, market analyst at IG Markets in Melbourne, said sentiment got a boost from figures released by the Conference Board which showed China's economic activity increasing in July.

Additionally, the International Monetary Fund said Tuesday that China's economy would grow 9.5 percent in 2011 and 9 percent in 2012. That's lower than the IMF's previous forecasts but still robust.

"Any signs we're getting that China's growth is reasonably solid is seen as good news by the markets," Peacock said.

In Hong Kong trading, developer China Vanke Co. Ltd. fell and China Overseas Land & Investment lost 2.3 percent. Esprit Holdings Ltd. fell 7.8 percent while Hong Kong-listed shares of Italian luxury fashion house Prada SpA lost 0.6 percent.

Zijin Mining Group Ltd., China's biggest gold miner, lost 3.2 percent, a day after the Ministry of Industry and Information Technology said China's gold output grew at a slower pace during the January-July period, state-run Xinhua News Agency reported.

On Wall Street, stocks rose on hopes the U.S. central bank would announce steps to boost the flagging economy. Many analysts believe the Fed will announce a new stimulus plan at the end of a two-day policy meeting Wednesday.

The Dow Jones industrial average closed up 0.1 percent at 11,408.66. The Standard & Poor's 500 index fell 0.2 percent to 1,202.09. The Nasdaq composite fell 0.9 percent to 2,590.24.

Meanwhile, debt-saddled Greece moved closer Tuesday to getting the vital bailout funds it needs to avoid a disastrous default on its debts after persuading international debt inspectors to return to Athens and resume reviewing its austerity program. Without the money, the country would default within weeks.

Greece has been depending on rescue loans from other eurozone countries and the IMF since May 2010, when its borrowing costs went through the roof following revelations Athens had been underreporting an alarmingly bloated budget deficit and public debt.

Greece is only one of several European countries that investors fear may be at risk of failing to pay their debts. On Monday night, the ratings agency Standard & Poor's cut Italy's credit rating by one notch. Italy has the second-biggest debt burden among countries that use the euro, after Greece.

If Greece or Italy were to default, European banks that have lent money to the countries could lose billions of dollars. That could hurt the European banking system and have repercussions for U.S. banks. Investors are concerned that a default in Europe could cause a lending crisis similar to what happened after the collapse of Lehman Brothers in 2008.

In energy trading, benchmark oil for October delivery was down 35 cents at $86.57 in electronic trading on the New York Mercantile Exchange. Crude rose $1.11 to settle at $86.92 on Tuesday.

In London, Brent crude for November delivery was up 9 cents at $110.63 on the ICE Futures exchange.

The euro rose to $1.3719 from $1.3688 late Monday. The dollar was steady at 76.35 yen.

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