Asian Indices traded mixed on Wednesday as concerns among investors remain grown over the very little progress made so far ability in the ongoing US Debt Ceiling discussions.

Equities in Asia were subdued, with stocks in Singapore and South Korea falling, while shares in Malaysia and Indonesia were little changed. Stocks declined in Japan while futures in Hong Kong pointed lower.

South Korea’s Kospi gained 0.18%, while Hong Kong’s Hang Seng index plunged 1.16%. In China, the SSE Composite Index traded 0.81% lower.

In Japan, Nikkei 225 dropped 0.56% following a breathless eight-day rally and the Topix fell 0.19% in early trade. MSCI’s broadest index of Asia-Pacific shares outside Japan was down 0.62%.

Manufacturing activity in Japan increased for the first time in seven months in May, according to survey data released on Tuesday, while the service sector had record growth as the recovery from COVID-19 takes steam.

Toyota Motor shares rose up to 5.3% in Tokyo, defying the trend. Alibaba’s cloud division laid off 7% of its workers in preparation for fundraising and a spinoff from its parent. Alibaba Group Holdings’ stock dropped 1.69%.

Malaysia will publish its April Consumer Price Index (CPI) report later this week.
The Bank of Korea is anticipated to hold interest rates unchanged at its meeting on Thursday. Meanwhile, to support the faltering economy, Vietnam’s central bank will decrease its refinancing rate by another 50 basis points to 5%.

Asian currencies were under pressure on Wednesday as the US debt ceiling talks showed no indications of progress ahead of the deadline, unsettling market participants and lowering their risk appetite.

The Malaysian ringgit sank 0.78% to its lowest level since November, while the South Korean won continued its five-day surge, rising 0.3% against the US dollar. The Vietnam dong declined 0.021%, reaching its lowest level in approximately five weeks.

The offshore yuan was little changed at 7.0636 per dollar, while the Japanese yen was higher at 138.58 per dollar.