Asian stocks mixed as US government shuts down

Asian stocks were mixed in early October trading, after Wall Street fell and gold prices held at a record high on Monday as U.S. lawmakers failed to reach a deal to avoid a federal government shutdown.

Stock index board in Seoul, South Korea. Photo: Yonhap/TTXVN

In the morning trading session on October 1 in the Asian market, the prospect of US government agencies having to shut down has dominated market sentiment, somewhat overshadowing expectations that the US Federal Reserve (Fed) will continue to cut interest rates. A budget crisis could lead to the postponement of the release of important economic data that the Fed relies on to make policy decisions.

The two parties in the US, Republicans and Democrats, have been unable to narrow their differences on a spending package to maintain the Government's operations after September 30 (local time) - the end of the 2024-2025 fiscal year - and continue to blame each other. The Republican-controlled Senate has tried to pass a temporary funding bill approved by the House of Representatives, but lacked enough Democratic support to send it to President Donald Trump. Meanwhile, Democrats want to restore hundreds of billions of dollars in health care funding for low-income households - an expense that the Trump administration plans to cut.

While most previous government shutdowns have been brief and had little impact on markets, investors are concerned that this one could have a bigger impact, especially if it delays the release of the nonfarm payrolls report, scheduled for October 3, which is key to the Fed’s assessment of the labor market and its interest rate decisions.

In Tokyo, the Japanese stock market fell sharply in the morning session on October 1, as the possibility of a US government shutdown increased. The Nikkei 225 index fell 521.37 points, equivalent to 1.16%, to 44,411.26 points - although it still recorded an 11% increase in the previous quarter.

Meanwhile, South Korean stocks rose nearly 1% in late morning trading on expectations that the Fed will continue to cut interest rates. The KOSPI index rose 29.11 points, or 0.85%, to 3,453.71.

In Taiwan, the stock market rose 1.3%. Taiwan's chief trade negotiator said the economy will not accept US demands to move half of its chip production to the US.

Mainland China and Hong Kong (China) stock markets are closed for holidays.

In the corporate equity market, shares of Australian mining giant BHP fell more than 1% after reports that Chinese state-owned iron ore buyers asked steelmakers to halt dollar-denominated seaborne purchases from BHP due to a pricing dispute.

In Vietnam, in the middle of the trading session on October 1, the VN-Index increased by 1.6 points (0.11%) to 1,663.53 points, the HNX-Index remained unchanged, standing at 273.16 points.

Source: https://baotintuc.vn/thi-truong-tien-te/chung-khoan-chau-a-bien-dong-trai-chieu-khi-chinh-phu-my-dong-cua-20251001121937466.htm