Asian shares rise after US debt ceiling deal

World
Europe

US President Donald Trump and congressional leaders unexpectedly agreed to raise the government debt limit on Thursday until December, eliminating the short term risk of a US government shutdown but also causing Asian shares to bounce back.

The euro maintained slim gains this week, ahead of the European Central Bank’s policy meeting later in the day, while oil prices were supported as US Gulf Coast refineries restart in the wake of Hurricane Harvey.

MSCI's broadest index of Asia-Pacific shares outside Japan’s MIAPJ gained 0.3 percent while Japan's Nikkei rose 0.2 percent.

“The deadline on the debt ceiling has been extended just by three months so it will come back to haunt markets again later this year. Still, markets liked it as we don’t have to worry about it for now,” said Masahiro Ichikawa, senior strategist at Sumitomo Mitsui Asset Management.

AFP Photo

ECB in focus

The rise in appetite for risk helped the dollar bounce back to 109.03 yen from Wednesday's low of 108.45 yen.

However, the main focus of the day is the euro. The currency stood almost flat at 1.1925 US dollars ahead of the ECB's policy meeting, maintaining its uptrend since the start of this year.

Traders are now shifting their focus to Hurricane Irma, ranked as one of the five most powerful Atlantic hurricanes in the last 80 years, which was passing over the northernmost Virgin Islands on Wednesday afternoon and expected to reach Florida at the weekend.

2110km

Source(s): AP ,AFP ,Reuters