Asian Equities Mostly Advance after White House Says Debt Ceiling Deal Possible by Next Week

Stocks in Asia mostly rose on Friday following two of the three major Wall Street indexes set new highs overnight and House Speaker Kevin McCarthy expressed optimism that a deal might be reached on the U.S. debt ceiling by next week.

At 9:32 a.m. Bangkok time, the Nikkei 225 index gained 0.95%, keeping it at its highest level since 1990, putting Japanese markets on track for their best week since October. Core inflation in Japan continued to trend beyond the monetary authority’s 2% objective in April, at 3.4% annually.

Australia’s S&P/ASX 200 was 0.46% higher, while South Korea’s Kospi gained 0.52%.

Hong Kong’s Hang Seng index fell 1.43% and the Shanghai Composite in mainland China slid 0.69%.

Overnight, traders on Wall Street pushed the S&P 500 and Nasdaq Composite to its highest closing levels since August 2022 as they remained focused on debt ceiling negotiations.

The Nasdaq jumped 1.51%, reaching new 52-week highs, while the S&P gained 0.94%. The Dow Jones Industrial Average climbed 0.34%.

On Thursday, House Speaker Kevin McCarthy expressed optimism that Congress will be able to strike a debt ceiling agreement in time for a vote next week.

McCarthy told reporters in the Capitol, “I see the path that we can come to an agreement.” “And I think we have a structure now and everybody’s working hard, and I mean, we’re working two or three times a day, then going back getting more numbers,” he added.

To prevent a default on US debt, McCarthy and Senate Majority Leader Chuck Schumer are preparing for votes in the coming days. Treasury Secretary Janet Yellen warned that a failure to increase the debt ceiling would have “catastrophic” consequences for the global financial system.

The Group of Seven leaders are starting their summit today in Hiroshima, Japan.