Asian stocks advance despite US government shutdown

Asian stocks advance despite US government shutdown
The Associated Press

BEIJING (AP) — Asian stock markets were mostly higher Monday after global investors shrugged off the latest U.S. government shutdown.

KEEPING SCORE: The Shanghai Composite Index gained 0.3 percent to 3,497.08 while Tokyo’s Nikkei 225 ended flat at 23,816.33. Hong Kong’s Hang Seng gained 0.3 percent to 32,353.73. Sydney’s S&P-ASX 200 shed 0.2 percent to 5,991.90 and Seoul’s Kospi tumbled 0.7 percent to 2,502.11. India’s Sensex advanced 0.3 percent to 35,605.57 and benchmarks in Southeast Asia rose.

U.S. SHUTDOWN: A range of 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 records despite the impending government shutdown. Retailers, banks and consumer goods companies accounted for much of the 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 step toward ending 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 110.87 yen from Friday’s 110.75 yen. The euro gained to $1.2226 from $1.2220.

ENERGY: Benchmark U.S. crude gained 10 cents to $63.41 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 17 cents to $68.78 in London. It lost 70 cents the previous session to $68.61.

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