Asian Stocks Down Over U.S. Congress’ Stimulus Measures Deadlock By

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By Gina Lee – Asian stocks were mostly down on Wednesday morning, following overnight declines in U.S. markets.

Investor sentiment was dampened by the deadlock in the U.S. Congress over the latest COVID-19 stimulus measures, with Senate Majority Leader Mitch McConnell stating on Tuesday that talks are at a stalemate.

“We have enormous uncertainty. It appears it’s getting harder for both sides to compromise as the election is nearing… Trump’s proposals would be smaller than markets have expected. There’s question over whether they are viable, too,” Junpei Tanaka, strategist at Pictet, told Reuters.

Investors will now be looking to see whether the two sides can reach a consensus, with negotiations continuing for the fourth day.

In the Asia Pacific region, New Zealand reported its first cases in 102 days as four COVID-19 cases were reported in Auckland. Prime Minister Jacinda Arden promptly re-imposed lockdown measures in the city and restricting travel across the country, as well as deferring the dissolution of parliament ahead of September’s general election.

But with the measures to be imposed for a far shorter period than the previous lockdown, some investors remained optimistic.

“If the lockdowns are removed after three days, the damage to New Zealand’s economy should be small,” Joseph Capurso of Commonwealth Bank of Australia (OTC:) said in a note.

Neighboring Australia is fighting its own battle against the pandemic, with the second largest city of Melbourne currently under stage 4 COVID-19 restrictions, and the country reporting the biggest daily rise in infections in three days on Wednesday.

Dismal data also dampened the mood Down Under, with the Australian Bureau of Statistics reporting that wages grew at a record slow pace during the second quarter. The official wage price index inched up 0.2% and 1.8% , with both figures missing expectations. Consumer confidence also collapsed, with the reporting a 9.5% dive to 79.5 in August.

The was down 0.46%. by 11:27 PM ET (4:27 AM GMT).

Japan’s was up 0.15%, the sole gainer in the region, while South Korea’s inched down 0.13%.

Hong Kong’s was down 0.36%, with Tencent (HK:) and Cathay Pacific (HK:) both reporting their earnings later in the day. Investors are also keeping an eye on Next Digital (HK:), or Next Media, shares, after founder Jimmy Lai’s arrest on charges of violating the city’s national security laws on Monday sparked an outcry that sent share prices up 1,200% over two days. Lai was released on bail earlier in the day.

China’s fell 93% while the slid 1.95%. Officials from the U.S. and China are scheduled to discuss their phase one trade deal, as well as potentially air grievances, at an online meeting on August 15.

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