Shares were mixed in Asia on Wednesday, with Chinese markets closed for a weeklong holiday, as a U.S. government shutdown loomed.
Japan’s Nikkei 225 index shed 1.2% to 44,411.26 after the Bank of Japan reported a slight improvement in business sentiment among major manufacturers.
The BOJ’s quarterly tankan adds to the likelihood the central bank will raise its key interest rate soon, to counter inflation that has topped its target range of about 2% for some time.
Political uncertainty is also looming over Japan’s markets, with the ruling Liberal Democratic Party due to chose a new leader and prime minister later this week to replace embattled Prime Minister Shigeru Ishiba.
Although markets and offices in mainland China are closed Oct. 1-8 for the National Day holiday, China’s central bank said it plans a 1.1 trillion yuan ($160 billion) reverse repo operation on Oct. 9, to increase the amount of cash in circulation and stimulate consumer spending and business investment.
Elsewhere in Asia, South Korea’s Kospi gained 0.8% to 3,450.62, while Taiwan’s Taiex added 1.3% on heavy buying of semiconductor-related shares.
Australia’s S&P/ASX 200 slipped 0.4% to 8,812.90.
Markets appeared to be taking a potential shutdown of the U.S. government in stride ahead of a midnight U.S. Eastern time deadline. Past U.S. government shutdowns have had a limited impact on the economy and stock market, and many investors expect something similar this time around.
Many economists and professional investors expect something similar this time around.
The S&P 500 rose 0.4% to 6,688.46 to close out its fifth straight winning month after setting a record last week. The Dow Jones Industrial Average gained 0.2%, to set its own all-time high at 46,397.89.
The Nasdaq composite ticked 0.3% higher to 22,660.01.
This shutdown could be different, with the White House prone to push for large-scale firings of federal workers.
The broad stock market has been on a nearly relentless run since hitting a low in April on expectations that President Donald Trump’s tariffs won’t derail global trade and that the Federal Reserve will cut interest rates several times to boost the slowing job market.
Treasury yields wavered in the bond market but ultimately held relatively steady following mixed reports on the U.S. economy. One said consumers are feeling less confident than economists expected, with many respondents in the Conference Board’s survey pointing to the job market and to inflation that has remained higher than anyone would like.
Source: Asian shares are mixed as markets shrug off a likely US government shutdown
