Asian stock markets were mixed on Wednesday ahead of a U.S. vote on raising the nation’s borrowing limit.
Analysts said that stock markets had room for gains if U.S. lawmakers make progress on raising the debt ceiling. The House is set to vote on a motion to increase the nation’s $16.4 trillion borrowing authority for three months.
Without congressional action, the Treasury sometime in late February or early March will not have enough money to pay for all of its obligations, creating the possibility of a first-ever default on the government’s debts.
“A vote is expected today, and if it is passed as expected it should clear the very short term obstacles for risk appetite, although battles on automatic spending cuts and the budget itself are not so long away,” said analysts at Credit Agricole CIB in a market commentary.
Japan’s Nikkei 225 index fell 0.8 per cent to 10,623.66, a day after the country’s central bank announced widely expected measures to help the economy, including open-ended asset purchases starting in 2014. Analysts said investors were disappointed that the central bank didn’t take more aggressive measures.
South Korea’s Kospi rose less than 0.1 per cent to 1,997.84. Hong Kong’s Hang Seng advanced 0.1 per cent to 23,693.16. Australia’s S&P/ASX 200 rose 0.3 per cent to 4,791.10.
Strong earnings reports from big U.S. companies helped push the Dow Jones industrial average to its eighth gain in nine sessions Tuesday. The gains came despite a report showing sales of previously occupied homes dipped in December from November.
The news wasn’t as bad as it looked. Sales rose last year to 4.65 million, a 9.2 per cent increase from the previous year and the most in five years.
The Dow closed up 0.5 per cent at 13,712.21. The Standard & Poor’s 500 index gained 0.4 per cent to 1,492.56. The Nasdaq composite average rose 0.3 per cent to 3,143.18. Tech behemoths Google and IBM reported solid earnings gains after the market closed.
Benchmark oil for March delivery was down 4 cents to $96.64 per barrel in electronic trading on the New York Mercantile Exchange. The contract rose 68 cents to close at $96.24 a barrel on the Nymex on Tuesday.
In currencies, the euro fell to $1.3315 from $1.3317 in New York on Tuesday. The dollar fell to 88.62 yen from 88.76 yen.
