Global stocks were mixed Monday after global investors shrugged off the latest U.S. government shutdown.
KEEPING SCORE: In early trading, German’s DAX was off 8 points at 13,423.85 and France’s CAC 40 declined 0.1 percent to 5,519.85. London’s FTSE 100 was up 5 points at 7,735.77. On Friday, the DAX rose 1.2 percent, the CAC 40 added 0.6 percent and the FTSE 100 gained 0.4 percent. On Wall Street, the future for the Dow Jones industrial average was off 0.2 percent and that for the Standard & Poor’s 500 index was down 0.1 percent.
ASIA’S DAY: The Shanghai Composite Index rose 0.4 percent to 3,501.36 points and Tokyo’s Nikkei 225 ended up 8 points at 23,816.33. Hong Kong’s Hang Seng advanced 0.4 percent to 32,393.41 and India’s Sensex added 0.7 percent to 35,765.62. Seoul’s Kospi lost 0.7 percent to 2,502.11 and Sydney’s S&P-ASX 200 shed 0.2 percent to 5,991.90. Benchmarks in Taiwan, New Zealand and Southeast Asia gained.
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.”
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 110.78 yen from Friday’s 110.75 yen. The euro gained to $1.2241 from $1.2220.
ENERGY: Benchmark U.S. crude gained 19 cents to $63.50 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 18 cents to $68.79 in London. It lost 70 cents the previous session to $68.61.