(AP) Worries about the U.S. economy and a looming budget battle in Washington kept Asian stock markets in check Thursday.
Data released Wednesday showed orders for long-lasting durable goods increased by only 0.1 percent in August after a sharp drop the month before, raising concerns that third quarter U.S. economic growth may not be as strong as anticipated.
Meanwhile, two financial deadlines for the U.S. government loom. Congress needs to pass a funding bill to keep the federal government operating after Oct. 1, when its new fiscal year starts. And the nation's borrowing limit needs to be raised before Oct. 17.
"The prospect of a U.S. Federal government shutdown is likely to undermine equity prices further in the coming days," said analysts at Capital Economics in an email commentary.
The White House and Republican lawmakers, who disagree on spending cuts and other key budget issues, have just days to reach a compromise. In 2011, a similar situation roiled markets at a time when Europe's debt crisis was flaring, and prompted Standard & Poor's to strip the U.S. of its triple A credit rating.
Japan's Nikkei 225 index overcame initial losses to advance 0.3 percent to 14,668.60. South Korea's Kospi gained 0.4 percent to 2,005.45. Australia's S&P/ASX 200 index rose 0.1 percent to 5,282.40. Benchmarks in Indonesia and Thailand also rose, while those in Singapore, Taiwan and the Philippines fell.
Hong Kong's Hang Seng shed 0.4 percent to 23,112.66 and the Shanghai Composite Index shed 1.5 percent to 2,166.17. Chinese banking shares fell after reports showed a sharp drop in total yuan deposits.
"The banks in China lost about 200 billion in deposits. The money probably went into shadow banking, which means they created a liquidity problem for banks," said Francis Lun, chief economist at GE Oriental Financial Group in Hong Kong.
Hong Kong-listed China Construction Bank fell 1.8 percent while Industrial and Commercial Bank of China, the world's biggest bank by market value, lost 1.4 percent.
Wall Street stocks fell for a fifth straight session. The Dow Jones industrial average fell 0.4 percent to close at 15,273.26. The Standard & Poor's 500 fell 0.3 percent to 1,692.77. The Nasdaq composite dropped 7.16 points, or 0.2 percent, to 3,761.10.
Benchmark oil for November delivery was down 35 cents to $102.33 per barrel in electronic trading on the New York Mercantile Exchange. The contract fell 47 cents to close at $102.66 a barrel on the Nymex on Wednesday.
In currencies, the euro rose to $1.3522 from $1.3517 late Wednesday. The dollar rose to 98.81 yen from 98.48 yen.
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