Global Stocks Shrug Off U.S. Government Shutdown

By Kenan Machado 

Asian stocks were largely muted early Monday following the federal government shutdown in the U.S., but South Korea's benchmark index slipped on fresh worries about iPhone demand.

Samsung Electronics fell 2% amid speculation that orders for the iPhone X would be cut. Although the smartphone maker is Apple's biggest rival, it is also a global manufacturer of components.

Samsung's next-generation displays feature organic light-emitting diodes, or OLED, technology Apple has adopted for the iPhone X. But SK Kim, who tracks Samsung for Daiwa Securities, said there are some concerns Apple could stop using OLED screens amid quality issues.

"However, I think the market reaction is overdone," he added.

The Kospi was recently 1% lower, dragged down by index heavyweight Samsung.

Stocks in other Asian markets were little swayed by the U.S. budget impasse, with the situation largely seen as "political brinkmanship with little economic impact," said Michael McCarthy, chief market strategist at CMC Markets. The previous government shutdown, in late 2013, had no effect on the economy.

The Wall Street Journal Dollar Index was recently down 0.1%, 10-year Treasury yields remained at 2.66% and S&P 500 futures were off 0.1%.

New Zealand's NZX-50 was up 0.5%, rebounding from early losses on concerns about the surge in the country's currency following 2017 weakness.

The New Zealand dollar recently hit multimonth highs against its U.S. counterpart, leading to declines in some export-reliant companies. But the currency rally took a pause in recent days, helping to extend gains for a2 Milk, which rose another 3.5% Monday.

(END) Dow Jones Newswires

January 21, 2018 21:38 ET (02:38 GMT)

Copyright (c) 2018 Dow Jones & Company, Inc.