*

Fed drops reference to inflation 'progress', but Powell

says

still on track

*

Dollar supported by higher US yields but policy outlook

uncertain

*

Mixed 'Mag 7' earnings from Microsoft ( MSFT ), Meta and Tesla;

Apple ( AAPL ) up

next

*

US crude settled at lowest this year as Trump tariffs loom

this

weekend

By Kevin Buckland

TOKYO, Jan 30 (Reuters) - Asian share markets were mixed

in thin trading on Thursday as much of the region was on holiday

for the Lunar New Year, while the U.S. dollar trod water after

the Federal Reserve signaled a pause in policy easing.

The U.S. central bank held interest rates steady overnight

as widely expected, with Fed Chair Jerome Powell saying there

would be no rush to cut them again.

President Donald Trump's policies remain a risk for the

Fed's policy outlook, and Saturday is likely to see new tariffs

slapped on Canada, Mexico and possibly China as well.

"Powell was unwilling to be drawn on the potential economic

impact and monetary policy response to tariffs, immigration and

regulatory change, but clearly the tails of the risk

distribution related to these factors are long and heavy," said

Elliot Clark, head of international economics at Westpac.

"Powell made clear in the press conference though that,

while strong, the economy is not overheated."

On Wall Street, after-the-bell earnings reports from members

of the Magnificent Seven megacap tech stocks were a mixed bag.

Microsoft ( MSFT ) beat quarterly revenue estimates, while

Tesla's fourth-quarter profit margin missed

expectations. Meta forecast first-quarter revenue below

market estimates.

Another of the Mag 7, Apple ( AAPL ), reports results later

Thursday.

The results did little to further the debate on Chinese

startup DeepSeek's potential threat to U.S. dominance in

artificial intelligence, and the big spending behind it -

questions that triggered a rout in global tech stocks on Monday.

U.S. stock indexes ended slightly lower on Wednesday, and

tech was the biggest drag on the S&P 500, as

the benchmark slipped 0.5%.

However, the mood looks to have improved with futures

pointing 0.4% higher as of 0136 GMT.

Australia's stock benchmark rose 0.5%, while Japan's

Nikkei was flat after overcoming some early weakness.

Most other major markets remained shut for holidays,

including Hong Kong and mainland China.

The U.S. currency was overall steady against major peers at

107.89 on the dollar index, after ending Wednesday flat.

The euro was little changed at $1.0420 ahead of

the European Central Bank's policy decision later in the day,

with traders all but certain of a quarter-point rate cut, and

looking for clues to justify the market view of up to three

additional reductions this year.

Sterling was flat at $1.2451.

The yen, however, strengthened about 0.4% to 154.55 per

dollar ahead of a speech from Bank of Japan Deputy

Governor Ryozo Himino in the Tokyo afternoon. Comments from

Himino earlier this month were among the first signs that the

policy board was moving towards hiking rates last week. Traders

currently expect one more quarter-point increase this year,

potentially as soon as July.

Oil prices ticked slightly higher, regaining some composure

after U.S. crude closed at the lowest level this year overnight,

with the near-term focus on Trump's threatened tariffs on Canada

and Mexico, the two largest suppliers of crude oil to the United

States.

U.S. crude futures rose 0.3% to $72.84 per barrel.

Brent crude futures added 0.2% to $76.73 a barrel.