Asian Shares Gain As US Debt Default Worries Ebb

(RTTNews) - Asian stocks rose broadly on Thursday as fears of a U.S. debt default eased, and a private survey showed China's factory activity unexpectedly swung to growth in May from decline.

The U.S. House of Representatives approved a debt ceiling and budget cuts package on Wednesday. The bill now heads to the Senate with passage expected by weekend.

The China Caixin/S&P Global manufacturing PMI rose to 50.9 in May from 49.5 in April, helping ease concerns that China's economic recovery was stalling.

Elsewhere, Japan's manufacturing PMI was finalized at 50.6 in May, up from April's 49.5 and marking the first expansionary reading since October 2022.

South Korea's factory activity shrank for an 11th consecutive month in the month and Australia's manufacturing industry continued to see a downturn.

The dollar came off its recent highs after a couple of Fed speakers signaled the U.S. central bank could skip a hike at its June meeting. Oil prices inched up slightly after two days of heavy losses.

China's Shanghai Composite index fluctuated before ending marginally higher at 3,204.63. Hong Kong's Hang Seng index ended little changed at 18,216.91.

Japanese shares rose notably after losses in the previous session due to portfolio adjustments at the end of the month.

The Nikkei average climbed 0.84 percent to 31,148.0, after having snapped a four-day winning streak in the previous session. The broader Topix index ended 0.88 percent higher at 2,149.29.

Daikin Industries, Japan Steel Works and SoftBank rallied 3-5 percent. Toyota Motor advanced 1.8 percent after the automaker said it would invest USD 2.1 billion more in its new U.S. battery plant in North Carolina.

Seoul stocks ended slightly lower to extend losses for a second day running. The Kospi average slid 0.31 percent to 2,569.17, dragged down by tech and auto shares. LG Energy Solution lost 2.5 percent, Hyundai Motor declined 1.3 percent and its affiliate Kia fell 2 percent.

Australian markets eked out modest gains led by gold miners and energy stocks. The benchmark S&P/ASX 200 rose 0.27 percent to 7,110.80 as investors looked ahead to RBA's interest-rate decision scheduled for next week. The broader All Ordinaries index settled 0.24 percent higher at 7,290.70.

Across the Tasman, New Zealand's benchmark S&P/NZX-50 index climbed 0.87 percent to 11,916.13 after a survey revealed business confidence in the country increased in May due to a bounce in a number of activity indicators.

U.S. stocks declined overnight as investors awaited the crucial vote on a bipartisan deal to suspend the government debt ceiling and set federal funding limits.

In economic releases, job openings rose unexpectedly in April, giving the Federal Reserve more reason to raise interest rates further if inflation stays high.

The Dow eased 0.4 percent, while the S&P 500 and the tech-heavy Nasdaq Composite both fell around 0.6 percent.