Asian stocks slide to two-month low on debt ceiling jitters

Asian shares stumbled to a two-month low on Thursday, and the U.S. dollar rose as the impasse in negotiations to raise the U.S. debt ceiling undermined risky assets on worries about the hit to the global economy if the U.S. government defaults.

MSCI’s broadest index of Asia-Pacific shares outside Japan (.MIAPJ0000PUS) fell 0.84% to 503.93, the lowest since March 21, and was on track for second straight month of losses.

China shares (.SSEC) fell 0.53% while Hong Kong’s Hang Seng index tumbled 2% to their weakest in 2023. The drop in these two markets weighed on MSCI’s Asia ex-Japan index, whose top 10 constituents include Tencent Holdings (0700.HK), Alibaba Group Holding (9988.HK), AIA Group (1299.HK) and Meituan (3690.HK).

Tokyo’s Nikkei remained an outlier in the region and was up 0.5%.

Negotiators for Democratic President Joe Biden and top congressional Republican Kevin McCarthy held what both sides called productive talks on Wednesday as they race to reach a deal to raise the debt ceiling.

This report’s information was first seen on REUTERS; to read more, click this link.