The Tokyo Stock Exchange stands in Kabutocho, Japan. Tokyo shares closed up 139.83 points to 15,115.80 yesterday.

AFP/Tokyo

Asian markets were mostly lower yesterday as tensions in Iraq dampened buying sentiment and investors await the outcome of the US Federal Reserve’s policy meeting later in the day.

The dollar extended gains against the yen, after climbing in New York on news that US inflation rose in May at its fastest pace for more than 18 months.

Tokyo rose 0.93%, or 139.83 points, to 15,115.80, with the weaker yen helping the Nikkei to a second day of gains.

But Seoul lost 0.60%, or 12.06 points, to 1,989.49 and Sydney fell 0.33%, or 17.97 points, to 5,382.7.

Hong Kong was flat, edging down 21.87 points to 23,181.72 while Shanghai fell 0.54%, or 11.18 points, to 2,055.52.

In other markets, Bangkok lost 1.34%, or 19.66 points, to 1,451.36; coal producer Banpu fell 2.54%, or 0.75 baht, to 28.75 while Bangkok Bank lost 1.04%, or 2baht, to close at 190.00.

Jakarta ended down 0.44%, or 21.66 points, at 4,887.86; Bank Tabungan Negara gained 3.40% to 1,065 rupiah, while cement producer Indocement Tunggal Prakarsa slipped 3.01% to 24,200 rupiah.

Kuala Lumpur rose 0.11%, or 1.98 points, to 1,876.58; Public Bank gained 0.1% to 20.92 ringgit, while Telekom Malaysia added 0.3% to 6.25. Budget carrier AirAsia slipped 0.9% to 2.33 ringgit.

Singapore rose 0.07%, or 2.36 points, to 3,276.80; oil rig maker Keppel Corp rose 0.09% to Sg$10.69, while DBS Bank was up 0.12% at Sg$17.06.

Taipei rose 0.43%, or 39.33 points, to 9,279.93; Taiwan Semiconductor Manufacturing Co added 0.4% to Tw$125.5 while smartphone maker HTC fell 3.97% to Tw$133.0.

Wellington dipped 0.17%, or 9.04 points, to 5,184.46. Manila was almost unchanged, losing 1.80 points to 6,703.13.

With few other catalysts to drive trade, investors are watching events in Iraq as militants close in on Baghdad after taking control of a number of towns and cities.

On Tuesday, Prime Minister Nuri al-Maliki sacked several top security commanders after government forces crumbled in the jihadist onslaught, which the UN has warned risks breaking up the country.

President Barack Obama has sent troops to Baghdad to strengthen security for the US embassy and is weighing potential military options, including air strikes, to counter the rebels.

The fighting has raised fears about oil supplies from the country. International prices are already at nine-month highs.

In afternoon Asian trade the US benchmark, West Texas Intermediate for July delivery, gained 41 cents to $106.77, while Brent crude for August added 25 cents to $113.70.

On Tuesday data showed US inflation at 2.1% in May, its highest since October 2012.

The news lifted the dollar in US trade to 102.13 yen from the 102yen earlier Tuesday in Asia.

In Tokyo afternoon trade yesterday the greenback bought 102.24 yen, while the euro fetched $1.3548 and 138.52 yen against $1.3546 and 138.35 yen in New York.

On Wall Street, the Dow rose 0.16%, the S&P 500 gained 0.22% and the Nasdaq climbed 0.37%.

Gold fetched $1,270.69 an ounce in Asia compared with $1,265 late Tuesday.