ASIAN markets struggle over US stimulus impasse : Traders given weak lead from Wall Street where stimulus struggle trumped improved data.

Asian markets drifted on Friday as investors grew increasingly concerned about the stalemate in Washington on a new stimulus for the world's top economy.

Hopes that Democrats and Republican would cast aside their mutual animosity to stump much -needed cash for struggling Americans have been key supporting equities for weeks. .

But they were dealt a blow on Thursday when senators broke up for a summer recess, saying they would not return until early next month, while both sides continued to trade accusations over who was to blame for the impasse.

Democrats have called on Republicans and the White House to double their $1 trillion offer, having reduced their own proposal to $2 trillion from an initial $3.5 trillion.

But Senator Leader Mitch McConnel accused his opponents of pushing for several socialist measures to be introduced into the new bill, describing their tactics as ''throwing spaghetti at the wall to see what sticks.''

Still, the expectation remains that an agreement will at some point be found, particularly with  election  just over two months away and millions of Americans in financial crisis.

''Congress political grandstanding delay is posing some risk for the global recovery,'' said Stephen Innes at AxiCorp.
''Still, there is no chance of this deal not going through for all the politically tarnishing Frugal Freddy reasons that have been alluded to.

''It is a matter of whether it is $1.5 trillion or $2 trillion, where bigger would be better.''

In early trade, Hong Kong dipped 0.1% and Shanghai was flat, while Tokyo ended the morning with small gains and Sydney added 0.5%.

Taipei was marginally higher but Seoul dropped more than 1%, while there were also losses in Singapore, Manila and Wellington.

Traders were given a weak lead from Wall Street, where the stimulus struggle trumped better-than-expected data showing fewer than a million people claimed jobless benefits last week for the first time since the pandemic stuck in March.

''After stalling over several weeks, US jobless [figures] have begun to decline again, suggesting the US labour market is starting to improve, now withstanding the economic impact from the containment measures introduced to combat the Covid-19 outbreak,'' said Rodrigo Catril at National Australia Bank.

But he warned ''ironically, an improving labour market may ease the pressure on US politicians to come up with a new stimulus plan.'' [AFP]


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