Asian stocks and U.S. index futures fell, while the yen snapped a four-day slump as American lawmakers struggled to reach an accord on raising the nation’s debt limit and restoring government operations. Industrial metals dropped after Chinese exports unexpectedly decreased.
The MSCI Asia Pacific excluding Japan Index slid 0.2 percent by 11:30 a.m. in Singapore, with markets in Japan and Hong Kong closed for holidays. Standard & Poor’s 500 Index futures lost 0.7 percent. The yen strengthened 0.3 percent while the currencies of South Korea and Thailand fell against the dollar. Futures on 10-year U.S. Treasuries rose a second day. Crude declined 0.2 percent and nickel was 0.6 percent lower.
With the U.S.’s borrowing authority set to lapse Oct. 17, the Senate wrapped up almost four hours of debate in Washington without unveiling a deal. China’s exports unexpectedly fell in September and inflation jumped on food prices, signaling constraints on the nation’s recovery as Premier Li Keqiang seeks to sustain growth without adding monetary stimulus. India today may report benchmark wholesale-price inflation was at 6 percent in September, compared with 6.1 percent a month earlier.
“There was no miracle deal done over the weekend in Washington, and investors were hoping by Monday morning things would be clearer and we could think about something else for a change,” said Richard Sichel, the chief investment officer at Philadelphia Trust Co., where he helps oversee $1.9 billion. “Instead, the debt ceiling is there, and all those headlines get in the way of looking at fundamentals.”
More than two stocks fell for each that rose on the MSCI Asia Pacific excluding Japan index, as Australia’s S&P/ASX 200 Index (AS51) slipped 0.4 percent and Taiwan benchmark measure slid 0.6 percent. New Zealand’s NZX 50 Index dropped 0.3 percent.
LG Electronics Inc., the world’s No. 2 television maker that gets about 30 percent of sales in North America, declined 0.7 percent in Seoul. Newcrest Mining Ltd., Australia’s biggest gold producer, decreased 3.9 percent.
Shares of Chinese railway companies rose amid speculation they may help build Thailand’s high-speed train system. CSR Corp. and China CNR Corp., the nation’s biggest train makers, jumped by the 10 percent daily limit after Thailand’s prime minister said China showed interest in developing the Southeast Asian country’s railway project.
The yen rallied to 98.30 per dollar after weakening 1.1 percent versus the greenback last week, the most since August. The Thai baht slid 0.2 percent to 31.34 after two days of gains while the Korean won fell 0.1 percent to 1,072.61 against the U.S. currency.
U.S. Senate Majority Leader Harry Reid said he’ll continue talks with Minority Leader Mitch McConnell after negotiations between U.S. President Barack Obama and House Speaker John Boehner broke down Oct. 12.
The congressional deadlock over raising the $16.7 trillion debt ceiling is threatening the U.S. and world economies, according to International Monetary Fund Managing Director Christine Lagarde. In an interview yesterday with NBC’s “Meet the Press” program, she cautioned against “creative accounting” by the U.S. to avoid a default.
Ten-year U.S. Treasury future contracts for December delivery rose 3/32 to 126 7/32, based on electronic trading at the Chicago Board of Trade. Yields on the notes climbed one basis point, or 0.01 percentage point, to 2.69 percent in New York Oct. 11. The U.S. bond market is shut for Columbus Day.
China’s overseas shipments dropped 0.3 percent from a year earlier, the General Administration of Customs said in Beijing on Oct. 12, trailing all 46 estimates in a Bloomberg survey. The nation’s consumer price index rose 3.1 percent from a year earlier, National Bureau of Statistics data showed. That exceeded the 2.8 percent median estimate of 44 analysts surveyed by Bloomberg and compared with a 2.6 percent gain in August.
Crude for November declined as much as 81 cents to $101.21 a barrel in electronic trading on the New York Mercantile Exchange. Gold was down 0.1 percent at $1,270.61 an ounce, after slipping 3 percent last week. Silver slid 0.9 percent.
Nickel for three-month delivery on the London Metal Exchange fell to $13,841 a metric ton while copper snapped a two-day advance. Zinc slipped 0.2 percent, dropping for the first time in seven days, and aluminum lost 0.6 percent.