Japan raises interest rates for the first time in 17 years; Nikkei whipsaws

Asia-Pacific markets largely fell Tuesday as investors assess central bank monetary policy decisions from the Bank of Japan and the Reserve Bank of Australia.

The BOJ officially ended its negative interest rate policy at its March meeting, hiking interest rates for the first time in 17 years and raising its benchmark interest rate from -0.1% to a range of 0% to 0.1%. The bank also abolished its yield curve control policy, marking a historic shift in policy.

Japan’s Nikkei 225 whipsawed on that news, reversing declines before plunging again, and was trading nearly 0.2% higher at midday trading. The broader Topix was up 0.19%.

Separately, the RBA has held its benchmark rate at 4.35% for the third meeting in a row, with the bank’s statement saying that “while recent data indicates that inflation is easing, it remains high,” and the bank’s board expects that it will be “some time yet” before inflation comes down to the RBA’s target range of 2-3%.

The S&P/ASX 200 rose 0.29% after the decision, extending gains from Monday.

South Korea’s Kospi fell 1.32%, while the small-cap Kosdaq inched 0.91% lower.

Hong Kong’s Hang Seng index slid 0.85%, and the mainland Chinese CSI 300 was down 0.17%.

Overnight in the U.S., all three major indexes rebounded as tech companies gained, while investors awaited monetary policy guidance from the Federal Reserve.

Nvidia shares rose 0.7% on the first day of the company’s GTC Conference — where the chipmaker is expected to showcase its latest inroads in artificial intelligence. Shares of Alphabet ended 4.6% higher after Bloomberg News reported that Apple was in talks with Google to include the company’s Gemini AI in iPhones.

The Dow Jones Industrial Average rose 0.2%, while the S&P 500 gained 0.63%. The Nasdaq Composite climbed 0.82%.

— CNBC’s Lisa Kailai Han and Brian Evans contributed to this report