Asian shares rose after tumbling the most in six weeks yesterday while Treasuries fell as sentiment among Japanese manufacturers increased to the highest since 2007 and investors gauged the impact of a partial shutdown of the U.S. government. Australia’s dollar gained on retail sales data.
The MSCI Asia Pacific Index of equities increased 0.2 percent to 138.80 as of 1:10 p.m. in Tokyo, trimming earlier gains of 0.4 percent as the U.S. shutdown became official. Standard & Poor’s 500 Index futures added 0.2 percent. Japan’s Topix index climbed 0.3 percent, while West Texas Intermediate oil fell 0.4 percent.
The Bank of Japan’s Tankan rose more than analysts expected, while China’s official factory gauge for last month increased for a third month. The Reserve Bank of Australia may keep its cash rate at 2.5 percent while reports later today may show euro-area and U.S. manufacturing expanded in September.
“Economic data in Asia has been better, that’s giving investors some amount of optimism,” Angus Gluskie, the chief investment officer who helps oversee about $500 million at White Funds Management in Sydney, said by phone. A shutting of the U.S. federal government “will only be temporary.”
The U.S. government began a partial shutdown at midnight for the first time in 17 years, putting as many as 800,000 federal employees out of work today, closing national parks and halting some government services after Congress failed to break a partisan deadlock.
No further negotiations were immediately planned, raising concerns among some lawmakers that the shutdown could bleed into a fight economists consider even more consequential: how to raise the nation’s debt limit to avoid a first-ever default after Oct. 17.