Asian stocks slip on U.S. shutdown worries, Trump’s fresh criticism of Fed

Asian stocks slip on U.S. shutdown worries, Trump’s fresh criticism of Fed

Asian markets were mostly lower on Wednesday after President Donald Trump said that there was “nothing new” on the partial government shutdown over a U.S.-Mexico border wall.

U.S. markets, which were closed for Christmas, were set to open higher on Wednesday. Stocks are still headed for their worst December since the Great Depression in 1931.

South Korea’s Kospi SEU, -1.31% fell 1.3% to 2,028.01 and the Shanghai Composite Index SHCOMP, -0.26% shed 0.3% to 2,498.29. Japan’s Nikkei 225 index NIK, +0.89% , which plunged 5% on Tuesday, picked up 0.9% to 19,327.06. Shares fell in Taiwan and throughout Southeast Asia. Markets in Hong Kong and Australia were closed.

The partial shutdown of the U.S. government that started Saturday shows no signs of abating. “Nothing new. Nothing new on the shutdown. Nothing new. Except we need border security,” Trump told reporters. The White House said Trump will reject any deal that does not include any funding for a wall or a fence. The Democrats have opposed this and are offering $1.3 billion for security. The routines of 800,000 federal employees are expected to be disrupted by the shutdown, but essential services will keep running.

Trump’s criticism of the U.S. central bank triggered a drop in Asian equities on Tuesday. “The only problem our economy has is the Fed,” the president said on Twitter. “They don’t have a feel for the Market, they don’t understand necessary Trade Wars or Strong Dollars or even Democrat Shutdowns over Borders.” Trump has since said since that interest rate hikes were a “form of safety” for an economy that was doing well, while stressing that the Fed was raising rates too quickly.

“The outsized moves are not reflective of the current U.S. economic landscape, but that seems to matter little so far as fear mongering continues to permeate every pocket of global capital markets,” Stephen Innes of OANDA said in a market commentary.

Benchmark U.S. crude CLG9, +1.60% added 18 cents to $42.71 a barrel in electronic trading on the New York Mercantile Exchange. The contract settled at $42.53 a barrel in New York on Monday. Brent crude LCOG9, +1.01% , used to price international oils, dropped 15 cents to $50.32 a barrel.

The dollar USDJPY, +0.28% strengthened to ¥110.61 from ¥110.31. The euro EURUSD, -0.0702% slipped to $1.1378 from $1.1392.

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