# Asian shares tentative, US debt ceiling talks weigh on risk appetite Author: Pal Sinha, Barnali Author URL: https://financedigest.com/author/pal-sinha-barnali Published: 2023-05-17 Category: NEWS Category URL: https://financedigest.com/category/news Meta Title: Asian Shares Subdued as US Debt Talks Weigh on Investor Meta Description: Stay informed about the latest market updates and economic data impacting Asian shares amidst U.S. debt ceiling talks and more. Read now! URL: https://financedigest.com/asian-shares-tentative-us-debt-ceiling-talks-weigh-on-risk-appetitehtml ![undefined](https://prod.superblogcdn.com/site_cuid_cm5qst7v3003gwirgwqtxn8i8/images/2023-05-17t034701z2lynxmpej4g02rrtroptp4china-markets-1736814009536-compressed.jpg) # Asian shares tentative, US debt ceiling talks weigh on risk appetite By Ankur Banerjee SINGAPORE (Reuters) – Asian shares were subdued on Wednesday and the dollar hovered around a five-week peak as investors remained risk averse, with the U.S. [debt ceiling talks and a mixed set of economic data](https://www.financedigest.com/wall-street-gains-dollar-climbs-on-solid-data-debt-ceiling-progress.html "Wall Street gains, dollar climbs on solid data, debt ceiling progress") weighing on sentiment. MSCI’s broadest index of Asia-Pacific [shares outside](https://www.financedigest.com/outside-door-handle-market-analysis-trends-top-manufacturers-share-growth-statistics-opportunities-and-forecast-to-2027.html "Outside Door Handle Market Analysis, Trends, Top Manufacturers, Share, Growth, Statistics, Opportunities and Forecast to 2027") Japan was 0.20% lower, while Australia’s S&P/ASX 200 index was down 0.56%. The Shanghai Composite Index and Hong Kong’s Hang Seng Index eased 0.4%, dragged by China data showing a wobbly [post-COVID recovery](https://www.financedigest.com/hotel-group-accor-continues-post-covid-recovery-after-a-gorgeous-summer.html "Hotel group Accor continues post-COVID recovery after a ‘gorgeous’ summer"). Japan’s Nikkei, however, spiked 0.68% higher, scaling above 30,000 for the first [time since](https://www.financedigest.com/sterling-slides-below-1-15-for-first-time-since-2020.html "Sterling slides below .15 for first time since 2020") September, 2021. Democratic President Joe Biden and top congressional [Republican](https://www.financedigest.com/republican-red-wave-fizzles-but-midterm-race-for-u-s-congress-tight.html "Republican ‘red wave’ fizzles, but midterm race for U.S. Congress tight") Kevin McCarthy edged closer to a deal to avoid a looming U.S. [debt default](https://www.financedigest.com/oil-slumps-5-to-five-week-low-amid-us-debt-default-fears.html "Oil slumps 5% to five-week low amid US debt default fears") Tuesday. After an hour of talks, McCarthy, the speaker of the House of Representatives, told reporters the two sides remained far apart on an agreement to lift the [debt ceiling](https://www.financedigest.com/european-shares-weighed-by-us-debt-ceiling-concerns-slide-in-financials.html "European shares weighed by US debt ceiling concerns, slide in financials"). But he said, “It is possible to get a deal by the [end of the week](https://www.financedigest.com/spain-expects-to-agree-with-banks-mortgage-relief-measures-by-end-of-week.html "Spain expects to agree with banks mortgage relief measures by end of week"). It’s not that difficult to get to an agreement.” Without an agreement, in about two weeks, the government might not be able to pay its bills, with economists [fearing the country will likely slide into a recession](https://www.financedigest.com/oil-settles-below-90-as-recession-fears-mount.html "Oil settles below as recession fears mount"). As the deadline approaches, “one thing investors can be certain of is that more uncertainty lies ahead”, said Saira Malik, [chief investment officer](https://www.financedigest.com/maistro-appoints-new-chief-commercial-officer.html "Maistro appoints new Chief Commercial Officer") at Nuveen. Malik [expects further volatility across equity and fixed income markets](https://www.financedigest.com/dredging-market-globally-expected-to-drive-growth-through-2031.html "Dredging Market Globally Expected to Drive Growth through 2031") until there is greater clarity on the outcome of the negotiations. “The most likely scenario is a resolution, perhaps at the eleventh hour, enabling the federal government to meet its obligations.” U.S. stock indexes closed down overnight, hamstrung by dour [forecast from Home](https://www.financedigest.com/smart-home-devices-market-is-expected-to-grow-at-a-healthy-cagr-of-over-18-during-the-study-forecast-period-2021-2031.html "Smart Home Devices Market is expected to grow at a healthy CAGR of over 18% during the study forecast period 2021-2031") Depot and April U.S. [retail sales data that underscored softer consumer spending](https://www.financedigest.com/automobile-shortages-spending-shift-to-services-hurt-u-s-retail-sales.html "Automobile shortages, spending shift to services hurt U.S. retail sales"). \[.N\] The main macro focus is on the U.S. [retail sales](https://www.financedigest.com/uk-retail-sales-jump-unexpectedly-but-big-picture-bleak-2.html "UK retail sales jump unexpectedly, but big picture bleak") figures, ING economists said. These actually came in on the [lower end](https://www.financedigest.com/wall-street-ends-lower-as-bond-yields-jump-on-growth-concerns.html "Wall Street ends lower as bond yields jump on growth concerns") of expectations though the news was mixed, with a lower headline but higher core sales figures muddying the message. Recent [economic data](https://www.financedigest.com/european-bourses-steady-as-focus-remains-on-key-economic-data.html "European bourses steady as focus remains on key economic data") indicates slowing in the U.S. economy following a string of [rate hikes by the Federal Reserve to fight high inflation](https://www.financedigest.com/uk-inflation-hits-9-4-bolstering-bets-on-big-boe-rate-hike.html "UK inflation hits 9.4%, bolstering bets on big BoE rate hike"). [Markets are pricing the Fed to cut rates towards the end of the year](https://www.financedigest.com/food-fiber-market-to-exhibit-increased-demand-in-the-coming-years.html "Food Fiber Market to Exhibit Increased Demand in the Coming Years"), according to CME FedWatch tool, but some Fed officials have stuck to a hawkish rhetoric. Atlanta Fed president Raphael Bostic said that the Fed will need to stay “super strong” in fighting inflation even if the [unemployment rate starts to rise](https://www.financedigest.com/u-s-job-growth-picks-up-in-june-unemployment-rate-rises-to-5-9.html "U.S. job growth picks up in June; unemployment rate rises to 5.9%") later in the year, while Chicago Federal Reserve President Austan Goolsbee said it was premature to be discussing interest rate cuts. Meanwhile, the [dollar index](https://www.financedigest.com/dollar-index-jumps-after-u-s-retail-sales-show-surprise-rebound.html "Dollar index jumps after U.S. retail sales show surprise rebound"), which measures the U.S. currency against six rivals, rose 0.01% to 102.61, inching closer to the five-week high of 102.75 it touched on Monday. The Japanese [yen weakened 0.05% to 136.47 per dollar](https://www.financedigest.com/dollar-hits-20-yr-high-as-yen-tumbles-on-dovish-bank-of-japan.html "Dollar hits 20-yr high as yen tumbles on dovish Bank of Japan"), while Sterling was last trading at $1.248, down 0.04% on the day. U.S. crude fell 0.31% to $70.64 per barrel and Brent was at $74.69, down 0.29% on the day, as a surprise rise in U.S. crude inventories stoked [demand concerns](https://www.financedigest.com/oil-rebounds-from-drop-on-china-demand-concerns.html "Oil rebounds from drop on China demand concerns") on the heels of weaker-than-expected economic data from the U.S. and China, the world’s two biggest [oil consumers](https://www.financedigest.com/increasing-consumer-adoption-to-fuel-demand-for-automotive-gear-oil-market.html "Increasing Consumer Adoption to Fuel Demand for Automotive Gear Oil Market"). \[O/R\] Gold prices held steady after retreating from the key $2,000-an-ounce mark in the previous session. Spot gold was last at $1,991.49 an ounce \[GOL/\] (Reporting by Ankur Banerjee; Editing by Himani Sarkar) --- This blog is powered by Superblog. Visit https://superblog.ai to know more. ---