By Chao Deng
China stocks were roughly flat while markets elsewhere in Asia
rose after the Federal Reserve stuck to a near-zero benchmark
interest rate, as expected.
The Shanghai Composite is down 0.2% at 3782.04 after snapping a
three-day losing streak Wednesday. Those gains followed
authorities' recent signals to continue supporting the market and
steps to investigate sharp declines.
The smaller Shenzhen Composite is down 0.1% at 2196.70 and the
small-cap ChiNext board is down 1.1% at 2664.39.
Hong Kong's Hang Seng Index is up 0.7% while a gauge of Chinese
companies listed in the city gained 0.6%.
Asian shares elsewhere rallied after the Federal Reserve offered
few clues on plans to raise interest rates for the first time in
nearly a decade. Its easy-money policy, mirrored by central banks
around the world, has helped fuel stock gains since the global
financial crisis, and a delay in raising rates could give stocks
more steam.
The Nikkei Stock Average was up 1.1%, helped by a weaker yen.
The Japanese currency was last at Yen124.12 compared with a close
of Yen123.94 in New York.
Australia's S&P ASX 200 was up 0.6% and South Korea's Kospi
was off 0.2%.
In China, the second wave of selling this month, driven by an
8.5% decline Monday, appears to have helped flush out leveraged
bets in the market.
Vincent Chan, analyst at Credit Suisse, said that financing for
buying stocks by informal lending channels, as tracked by one major
trading system, likely dropped sharply since mid-July. Authorities
have been clamping down on margin financing--the borrowing of money
by brokerages and unofficial lenders to investors--in an attempt to
stamp out speculative activity. Margin loans spur stocks to rise
and fall quickly.
Still "the direction may be irreversible," Mr. Chan wrote in a
note Thursday. "Informal activities will turn back to offline and
be underground, only to serve big individual clients as they were
before."
Investor's have been unnerved by Shanghai's irregular intraday
trading, which some analysts put down to government intervention in
the market. On Wednesday, the index surged in the last hour of
trading, which likely enticed more local investors to chase gains.
Chinese authorities don't disclose their pace of buying in the
market, or the total amount that they have bought up in stocks.
In recent weeks, officials have taken a number of measures to
calm investors and arrest selling, from halting new public listings
to posing a six-month ban on dumping stocks for big shareholders
and executives.
On Wednesday, the securities regulator said a listed arm of
China's state-owned aerospace and defense company and its two
largest shareholders are under investigation for potential
violation of stock-selling rules. Shares of AVIC Heibao Co. are up
5.4%.
In South Korea, shares of Samsung Electronics Co. were down 1.7%
after the firm logged its fifth-straight year-over-year drop in
profit. Sales for the company's flagship Galaxy S6 smartphone fell
short of market expectations and hurt profit.
In commodities, an unexpected decline in U.S. crude-oil supplies
and production led to a recovery in oil prices overnight. Prices
have slumped this month on renewed fears about a global glut and
faltering demand from China, one of the world's biggest consumers.
Brent crude, the global benchmark, was up 39 cents at $53.77 a
barrel in Asian trade.
Gold prices rose sharply after the Federal Reserve's statement,
but quickly gave up gains. Gold rallied as high as $1,100.90 a troy
ounce in aftermarket trading Wednesday as is currently at $1,094.60
in Asia.
Gold had sank to five-year lows in recent weeks amid
expectations for a rate increase, which could incite investors to
move to higher-yielding assets.
Write to Chao Deng at Chao.Deng@wsj.com