Asia close: Stocks slip amid US debt ceiling impasse, trade uncertainty

(Sharecast News) - Stocks in the Asia Pacific region traded slightly lower, pressured by news that the US congress might not meet the deadline to approve a Continuing Resolution and thus avoid a government shutdown on Saturday.

Overnight, it was reported that Democrats in the US Senate would not support a six-month stop-gap spending bill that would allow the government to keep operating until the end of the fiscal year, in September.

Instead, they offered a one-month continuing resolution in order to be able to negotiate changes.

Against that backdrop, the Nikkei-225 drifted lower by 0.08% to 36,790.03, the Shanghai Stock Exchange's composite index fell 0.39% to 3,358.73 and Hong Kong's Hang Seng was off by 0.58% at 23,462.65.

Taiwan's TAIEX fared worse, dropping by 1.42% to 21,961.68.

Investors were also waiting with bated breath for the US administration's threatened response to the EU's own retaliatory trade measures.

"US and European equity futures extended their slide, mirroring a rough session in Asia as two weeks of tariff-induced chaos continued to rattle risk sentiment," said Stephen Innes, managing partner at SPI Asset Management.

"With market whiplash in full force, the best trade now seems to be sitting flat or positioning selectively and defensively."