Some U.S. lawmakers said they would continue to oppose the agreement after a deal was struck between the White House and Republican negotiators. (Photo by Drew Angerer/Getty Images)
Global markets were mixed on Monday after a preliminary deal to raise the U.S. debt ceiling emerged over the weekend from negotiations between the White House and Republican negotiators.
After the deal was reached between President Joe Biden and House Speaker Kevin McCarthy (R., Calif.) on Saturday, the text was released late Sunday in an effort to shore up support from both sides of the political aisle, despite continued opposition from some U.S. lawmakers. Congressional votes on the deal could come as early as Wednesday in the House.
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U.S. markets are closed on Monday for the Memorial Day federal holiday. Investors looked to be holding their positions in safe-haven assets with spot gold prices broadly flat while the U.S. Dollar Index was up less than 0.1%, reversing early losses.
“Although the dollar took a breather on Friday and early today, the weekend consensus is nothing but a positive development as it diminishes concerns about economic instability and thereby allows investors to add to bets regarding a summer hike by the Fed,” wrote Charalampos Pissouros, an investment analyst at XM, in a research note on Monday.
Asian markets largely climbed Monday, led by a 1.0% rise in Japan’s Nikkei 225 Index. However, Chinese markets dragged with Hong Kong’s Hang Seng Index down 1.0%.
In Europe, the Stoxx Europe 600 Index was down 0.2%. Spain’s IBEX 35 was down 0.3% after Prime Minister Pedro Sanchez called a snap national election for late July, a day after his Socialist Party suffered heavy losses in regional and local elections.
The Turkish lira fell to a fresh record low against the dollar after Turkey’s President Recep Tayyip Erdogan claimed victory in Sunday’s runoff presidential election, extending his term in office for another five years. Erdogan has adopted a controversial policy of keeping interest rates low in order to tackle high inflation. The dollar rose 0.6% to 20.09 lira.
Write to Adam Clark at adam.clark@barrons.com
