Asian shares were mostly higher Friday as hopes grow that the U.S. Congress will reach a deal to avoid defaulting on the nation’s debt.
Japan’s benchmark Nikkei 225 rose 0.8% to finish at 30,808.35. Australia’s S&P/ASX 200 gained 0.6% to 7,279.50. South Korea’s Kospi added 0.9% to 2,537.79.
Chinese shares fell on renewed worries set off by signs an extended lockdown over the coronavirus pandemic was hurting sales. Also weighing on Chinese shares were inflationary pressures and geopolitical risks, analysts said.
Hong Kong’s Hang Seng slipped 1.3% to 19,475.08, while the Shanghai Composite lost 0.4% to 3,283.60.
“While the broader risk environment has been singlehandedly uplifted by progress around the U.S. debt ceiling negotiations, Chinese equities continue to struggle for gains,” said Yeap Jun Rong, market analyst at IG. President Joe Biden, now in Hiroshima for the Group of Seven summits of major industrialized nations, has said he’s confident about reaching a deal with Republicans to allow the U.S. government to increase its credit limit and borrow more
The U.S. government is scheduled to run out of cash to pay its bills as soon as June 1 unless a deal is made, and economists say a U.S. federal default could have catastrophic consequences across financial markets and the economy. Wall Street shares rose after more companies reported better profits than expected, while yields climbed after a Federal Reserve official cautioned the end to its interest-rate hikes may not arrive as soon as Wall Street hoped.
The S&P 500 gained 0.9%, adding to its rally from the day before as hopes rise that the U.S. government can avoid a default on its debt. The Dow Jones Industrial Average added 115 points, or 0.3%, while the Nasdaq composite climbed 1.5%. The S&P 500 gained 39.28 points to 4,198.05. The Dow rose 115.14 to 33,535.91, and the Nasdaq climbed 188.27 to 12,688.84.
Video game maker Take-Two Interactive had the biggest gain in the S&P 500 after it forecast a huge jump in revenue for the fiscal year following this one. That stoked speculation that Grand Theft Auto VI is on the way, and its stock jumped 11.7%. Bath & Body Works was close behind with a gain of 10.7%. It reported stronger revenue and earnings for the latest quarter than analysts expected.
