Asian shares gain as Bank of Japan tweaks monetary policy

Asian shares rose Wednesday after Japan's central bank wrapped up a policy meeting with a decision to keep short-term interest rates unchanged while adjusting its asset purchases to help push yields on long-term government bonds higher.

KEEPING SCORE: Tokyo's Nikkei 225 reversed its early losses, gaining 1.8 percent to 16,784.98. The Hang Seng of Hong Kong gained 0.7 percent to 23,703.58 and the Shanghai Composite index added 0.2 percent to 3,027.59. Australia's S&P/ASX 200 climbed 0.7 percent to 5,342.00 and South Korea's Kospi rose 0.5 percent to 2.034.77. Shares were higher in Taiwan and most markets in Southeast Asia.

BANK OF JAPAN WATCH: Japan's central bank announced it was shifting its monetary policy to enhance its control of short-term and long-term interest rates. By pushing yields on long-term government bonds higher, the central bank is expanding investment options for institutional investors such as life insurance companies. The BOJ kept its short-term policy rate at minus 0.1 percent but said it might cut it further to encourage banks to lend more.

FED TO FOLLOW: Investors doubt the Federal Reserve will raise interest rates Wednesday, but are watching closely for hints about future moves from the Fed's statement and a press conference led by Fed Chair Janet Yellen.

ANALYST VIEWPOINT: "The Fed, until they raise rates, are going to be the primary focus of the markets," said J.J. Kinahan, chief market strategist at TD Ameritrade. "The only reason people may take their eye off of that is the election."

WALL STREET: The Dow Jones industrial average gained 9.79 points, or 0.1 percent, to 18,129.96. The Standard & Poor's 500 index added 0.64 points to 2,139.76. The Nasdaq composite picked up 6.33 points, or 0.1 percent, to 5,241.35.

ENERGY: Benchmark U.S. crude added 83 cents to $44.88 a barrel in electronic trading on the New York Mercantile Exchange. It gained 19 cents to $44.05 a barrel on Tuesday. Brent crude, used to price international oils, advanced 66 cents to $46.54 a barrel in London.

CURRENCIES: The dollar jumped to 102.61 yen following the BOJ's announcement, from 101.62 yen in the previous session. The euro dropped to $1.1136 from $1.1152.

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AP Markets Writer Marley Jay contributed to this report.