Asian stocks mixed as investors await vote on debt ceiling, eyes Chinese economy

TOKYO (AP) — Asian stocks were mixed in directionless trading on Tuesday after a U.S. holiday as optimism about a U.S. debt deal was shaken by worries about the regional economy.

Japan’s benchmark Nikkei 225 rose 0.3% to 31,328.16. Australia’s S&P/ASX 200 edged down 0.1% to 7,209.30. The South Korean Kospi jumped 1.0% to 2,584.90.

Hong Kong’s Hang Seng rose less than 0.1% to 18,553.22. The Shanghai Composite fell less than 0.1% to 3,221.01.

Analysts say investors remain concerned about a possible “second wave” of COVID-19 cases in China, although the economic impact is expected to be more limited than during the previous pandemic wave.

China’s recovery from virus-related disruptions in recent years appears to be losing steam, adding to concerns about the regional economy.

“To say China’s economic openness has been a disappointment might be an understatement, especially judging by local stocks which are now on the cusp of a bear market,” said SPI’s Stephen Innes. Asset Management in a comment.

Global shares ended mostly higher on Monday after President Joe Biden and House Speaker Kevin McCarthy reached agreement on a deal to raise the US national debt ceiling. Now Biden and McCarthy are scrambling to muster the votes needed to secure congressional approval in time to avoid a default.

There are other concerns besides the threat of US debt default. A key measure of inflation that is closely watched by the Federal Reserve beat economists’ expectations in April. Persistent inflationary pressure is complicating the Fed’s fight against rising prices. The central bank has been raising interest rates aggressively since 2022, but recently signaled it would likely forgo a rate hike at its meeting in mid-June.

Markets are closely watching US consumer confidence data to be released later today.

In other trading, benchmark U.S. crude fell 25 cents to $72.42 a barrel in electronic trading on the New York Mercantile Exchange. Brent crude, the international standard, fell 44 cents to $76.63 a barrel.

The US dollar rose slightly to 140.44 Japanese yen from 140.38 yen. The euro traded at $1.0700, down from $1.0711.


Yuri Kageyama is on Twitter

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