* Asian stock markets: https://tmsnrt.rs/2zpUAr4
* Equities lack trend as earnings roll in
* Some analysts say stock valuations already high
* Fed expected to stay course but outlook is improving
By Stanley White
TOKYO, April 28 (Reuters) - Asian shares struggled to make firm gains on Wednesday as already high valuations discouraged investors from buying equities ahead of a closely-watched U.S. Federal Reserve meeting.
MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS declined 0.12%. Australian stocks .AXJO rose 0.47%, but shares in China .CSI300 slipped 0.06%. South Korean stocks .KS11 fell 0.99%. Stocks in Tokyo .N225 edged 0.46% higher.
S&P 500 e-mini stock futures EScv1 rose 0.14%.
Euro Stoxx 50 futures STXEc1 were up 0.25%, German DAX futures FDXc1 up 0.16%, FTSE futures FFIc1 up 0.31%, pointing to a positive start to European trading.
Fed Chairman Jerome Powell is expected later on Wednesday to reaffirm that easy monetary policy will remain in place for a prolonged period and dismiss any suggestions of tapering bond purchases. President Joe Biden will also address a joint session of Congress, where he may make additional comments about infrastructure and stimulus spending. developments would normally be a positive for stocks, but analysts say so much economic optimism is already priced into the equity market that it is difficult to buy stocks further from current levels.
"We expect the Fed's tone on the economy to be more positive than at the March FOMC meeting, reflecting the ongoing pickup in the data, but we don't expect any substantive new signal yet on tapering," analysts at TD Securities wrote in a research note.
"While we do not expect much price action due to the Fed decision, Biden's remarks could continue to suggest more incoming supply, bear steepening the (Treasury yield) curve."
The Dow Jones Industrial Average .DJI rose 0.01%, but the S&P 500 .SPX lost 0.02%, and the Nasdaq Composite .IXIC dropped 0.34% as investors digested a mixed bag of earnings from Tesla Inc TSLA.O , 3M (NYSE:MMM) Co MMM.N , Microsoft Corp MSFT.O , and Google-parent Alphabet GOOGL.O overnight.
Some investors were also reluctant to move before earnings from heavyweights Apple Inc AAPL.O , Facebook Inc FB.O , and Amazon.com Inc AMZN.O due later this week.
An improving U.S. economy, rising coronavirus vaccination rates, and expectations for big fiscal spending are causing more investors to question when the Fed will start slowing its bond purchases and how much inflation policymakers will tolerate.
Breakeven rates on 10-year Treasury Inflation-Protected Securities US10YTIP=RR , a measure of expected annual inflation for the coming decade, rose to 2.41%, the highest since 2013.
Yields on benchmark 10-year Treasuries US10YT=RR reached a two-week high of 1.6430%.
The dollar edged up slightly against the yen JPY= and the British pound GBP=D3 , but trading is expected to be subdued until Powell speaks after the Fed meeting.
The Australian dollar AUD=D3 was knocked lower after disappointing data on consumer prices. the cryptocurrency market, Ether ETH=BTSP pulled back slightly from an all-time high above $2,700 reached after Bloomberg reported that the European Investment Bank plans to sell a two-year digital bond worth 100 million euros ($120.80 million) on the ethereum blockchain network. cryptocurrency Bitcoin BTC=BTSP edged lower to $55,618.
In commodities, Brent crude LCOc1 futures fell 0.03% to $66.40 a barrel while U.S. West Texas Intermediate crude CLc1 lost 0.03% to $62.92 per barrel due to worries about energy demand.
Benchmark copper CMCU3 fell from a decade high of $9,965 a tonne hit on Tuesday due to concerns about softening demand in China, the world's top consumer of the metal.
Gold XAU= , which is often seen as a hedge against inflation, fell 0.28% to $1,771.70 in cautious trade ahead of the Fed meeting. ($1 = 0.8278 euros)
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