Asian stocks mixed after US government shutdown
BEIJING (AP) — Asian stock markets were mixed Monday after global investors shrugged off the latest U.S. government shutdown.
KEEPING SCORE: The Shanghai Composite Index rose 0.2 percent to 3,495.40 while Tokyo’s Nikkei 225 lost 0.2 percent to 23,764.96. Hong Kong’s Hang Seng edged less than 0.1 percent lower to 32,240.78 and Sydney’s S&P-ASX 200 shed 0.1 percent to 5,998.30. Benchmarks in New Zealand, Taiwan and Jakarta advanced. Seoul’s Kospi lost 1.1 percent to 2,492.96.
US SHUTDOWN: A wide range of federal government services were suspended after lawmakers failed to agree on a new budget, but economists said the shutdown was unlikely to last long enough to cause much damage. Investors and consumers are feeling optimistic now based on the tax cut signed into law last month, and the economy is strong enough to power through a short shutdown.
ANALYST’S TAKE: “The much-anticipated shutdown of the U.S. government on Saturday did not trigger much of a knee-jerk reaction in Asian markets,” said Margaret Yang of CMC Markets in a report. “Safe-havens namely Japanese yen and gold edged higher, showing market sentiment remains cautious amid uncertainties of how long it will take the Democrats and Republicans to find a common ground on immigration concessions in order for the government to resume operating.”
WALL STREET: Investors drove U.S. stocks higher, setting new market milestones last Friday despite the impending government shutdown. Retailers, banks and consumer goods companies accounted for much of the latest gains. Energy stocks fell along with crude oil prices. The Standard & Poor’s 500 index rose 0.4 percent, to 2,810.30 while the Dow Jones industrial average gained 0.2 percent to 26,071.72. The Nasdaq composite added 0.6 percent to 7,336.38.
GERMANY: Social Democrats voted to open talks on forming a new government for Europe’s largest economy with Chancellor Angela Merkel’s conservatives after party leaders urged members to overcome their apprehensions for the good of the country. The vote was a major step toward ending the political gridlock that has blocked formation of a government since September’s election. Many Social Democrats expressed concerns a 28-page agreement on prerequisites for coalition talks had watered down too many of their positions.
CURRENCY: The dollar edged up to 110.82 yen from Friday’s 110.75 yen. The euro gained to $1.2222 from $1.2220.
ENERGY: Benchmark U.S. crude gained 16 cents to $63.47 per barrel in electronic trading on the New York Mercantile Exchange. The contract fell 58 cents the previous session to $63.31. Brent crude, used to price international oils, rose 20 cents to $68.81 in London. It lost 70 cents the previous session to $68.61.