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Asian Shares Mixed As Fed Rate Hike Odds Rise

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Asian stocks were mixed on Thursday as upbeat U.S. data coupled with Fed Chair Janet Yellen's hawkish tone in her latest remarks on Capitol Hill helped spur expectations of a faster pace of Fed rate-hike in 2017.

U.S. retail sales rose more than expected in January and consumer prices rose at their fastest pace in nearly four years, boosting prospects of an interest rate hike as early as March.

Chinese stocks rose as higher commodity prices and media reports of a pick-up in spending on railways and other infrastructure this year boosted material stocks. The benchmark Shanghai Composite finished up 16.63 points or 0.52 percent at 3,229.62 while Hong Kong's Hang Seng index was up 112 points or 0.47 percent at 24,107 in late trade.

Japanese shares retreated as the dollar slipped against rivals, including the Japanese yen. The Nikkei average dropped 90.45 points or 0.47 percent to 19,347.53 while the broader Topix index closed 0.17 percent lower at 1,551.07. A stronger yen hurt automakers, with Honda, Nissan and Toyota ending down about half a percent each.

Toshiba tumbled 3.4 percent to extend losses after the troubled conglomerate delayed releasing its earnings results and said it would book a $6.3 billion hit to its U.S. nuclear unit.

Banks such as Mitsubishi UFJ Financial, Mizuho Financial and Sumitomo Mitsui Financial closed flat to slightly higher after U.S. bond yields climbed again on Wednesday on data showing the U.S. economy continues to strengthen.

Australian shares closed modestly higher after falling earlier in the session in the wake of some disappointing earnings updates and a mixed jobs report, which showed a decline in full-time employment. The benchmark S&P/ASX 200 inched up 7.20 points or 0.12 percent to 5,816.30, while the broader All Ordinaries index closed up 3.90 points or 0.07 percent at 5,863.

Financials closed mostly higher, with the big four banks closing up between 0.7 percent and 1.4 percent. CSL climbed 3.7 percent to extend Wednesday's gains after the biotech firm said it's on track to grow outside of its core plasma business.

Telstra shares slumped 6.6 percent after the telecom giant announced underwhelming half yearly profit numbers, hit by fierce competition, adverse regulatory rulings and ongoing restructuring. Tatts Group tumbled 3.6 percent as the gambling giant reported a 16.5 percent fall in first-half net profit, hit by falling revenue for its lotteries business.

Diversified miner South32 dropped 1.9 percent despite the company posting a sharp jump in half-year underlying earnings. Slater and Gordon plunged as much as 26 percent after a profit warning. Origin Energy declined 2.2 percent after the energy producer unveiled a first-half net loss of $1.68 billion.

Seoul shares finished lower as the Fed left the door open for a rate hike in March and Finance Minister Yoo Il-ho rejected media claims that the country has been manipulating its currency for competitive advantage. The Kospi gave up early gains to end the session down 2.02 points or 0.10 percent at 2,081.84.

New Zealand shares fell, dragged down by Spark New Zealand as the telecommunications company warned of increased competition in the mobile market after reporting a 12.7 percent rise in interim net profit. Weak consumer confidence data also weighed on sentiment.

While Spark shares fell 4 percent to $3.56, the benchmark S&P/NZX-50 index tumbled 80.05 points or 1.11 per cent to 7,099.98. Sky Network Television shares lost 2 percent after the company said it won't delay a proposed merger with Vodafone New Zealand.

Malaysia's KLSE Composite index was moving down 0.1 percent even as official data showed the country's GDP growth improved at a faster-than-expected pace in the three months ended December. Singapore's Straits Times index was rising 0.2 percent despite top lender DBS Group Holdings reporting its lowest quarterly profit in two years.

Indonesia's Jakarta Composite index was declining 0.2 percent and the Taiwan Weighted shed 0.3 percent while India's Sensex was rising half a percent after two days of losses.

Overnight, U.S. stocks rose again to hit fresh record closing highs for the fifth day in a row, as upbeat economic data added to optimism that Trump's proposals on taxes and corporate deregulation will expand the economy. The Dow and the S&P 500 rose about half a percent while the Nasdaq Composite gained 0.6 percent.

by RTT Staff Writer

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