Asian shares tread water, markets eye US Fed's inflation statements

 Asian shares marked time on June 24, with China nudging lower, while the United States dollar held below an 11-week high as investors reassessed US Federal Reserve statements on inflation

By Swati Pandey

SYDNEY (Reuters) - Asian shares marked time on Thursday, with China nudging lower, while the U.S. dollar held below an 11-week high as investors reassessed U.S. Federal Reserve statements on inflation and looked to upcoming data for direction.

MSCI's broadest index of Asia-Pacific shares outside Japan rose 0.1% to 695.2 points, off a one-month trough of 685.12 touched earlier this week.

Japan's Nikkei rose slightly to 28,905.5, while Chinese shares were in the red with the blue-chip CSI300 index off 0.3%.

On Wall Street, the Nasdaq closed at a record high on Wednesday, while other major U.S. indexes ended lower alongside European stocks.

The market has whipsawed over the last week, feeling the after-effects of a surprise projection for rate increases as soon as 2023 by the U.S. Federal Reserve which knocked stocks, boosted the dollar and led to the flattening of the U.S. bond yield curve.

Investors are now pricing the first full U.S. interest rate rise for February 2023 compared to December 2022 in the immediate aftermath of the Fed meeting.

Overnight, 10-year Treasury yields remained below 1.5% in muted trading.

"Until bond yields break out in a sustainable fashion, in either direction, it remains very hard to determine which direction stocks are headed in over the near term," JPMorgan analysts wrote in a note.

"Much continues to hinge on the upcoming growth data."

Europe released strong manufacturing activity data on Wednesday, while figures on ISM manufacturing and U.S. non-farm payrolls are due next week.