Asian markets slip as dealers track stimulus progress

US indices hit record high as economic hope overshadows jump in unemployment

Asian markets struggled on Friday to build on the previous day’s rally and a record lead from Wall Street as investors track US stimulus talks with lawmakers appearing to finally be closing on a deal.

After last month’s surge across equity markets, traders have in December been unable to kick on as vaccine optimism and signs of a breakthrough in Washington, as well as in Brexit negotiations, are offset by frighteningly high coronavirus infection and death rates around the world.

On Capitol Hill, top-level politicians remain locked in discussions for a rescue package they hope to get passed before the end of the year when crucial support measures for Americans run out.

The two sides, for months stuck in a stalemate, are inching towards a deal after a bipartisan group of lawmakers put together a proposal that appears attractive to each of them.

“I am heartened by our discussions and our progress. I believe all sides are working in good faith towards our shared goal of getting an outcome,” Republican Senate Majority Leader Mitch McConnell said in a statement, noting the package would include direct payments to people.

“We are going to stay right here until we are finished, even if that means working into or through the weekend.”

President Donald Trump also sounded a note of hope, tweeting that “stimulus talks looking very good”.

But top Democratic senator Chuck Schumer remained cautious, saying an agreement was near but adding that “a few final issues must be hammered out”.

All three major US indices ended at record highs, as long-term economic hope overshadowed data showing an unexpected jump in jobless numbers, which followed a report earlier in the week revealing a drop in retail sales. But Asia was unable to take the cue, with most markets in the red.

Sydney fell more than 1% on concerns about a possible fresh outbreak in the city, while Wellington also dropped more than 1%.

There were losses in Hong Kong, Tokyo, Shanghai, Mumbai and Singapore, while Seoul was marginally up.