BANGKOK (AP) — Uncertainty about the outcome of a budget battle in Washington pushed Asian stock markets lower on Monday.
President Barack Obama and his political opponents have failed so far to agree on a way to roll back automatic spending cuts that took effect Friday. Those cuts slash $85 billion from the nation's budget, which could slow down the economy.
U.S. lawmakers say they want to undo the cuts so that federal programs can be spared but are divided over whether higher taxes should be used to pay for them.
Evan Lucas of IG Markets in Melbourne said he believes the budget fight is just "another political distraction that will cause some investors to cash out and buy back in on the dips."
Hong Kong's Hang Seng fell 1.3 percent to 22,582.87, dragged down by property shares that tumbled after China's Cabinet ordered new measures to cool surging housing prices. The government said it will raise required minimum down payments in areas where prices are deemed to be rising too fast and crack down on efforts to evade limits on how many properties each buyer can acquire.
"The policy was already given out two weeks ago but last Friday, more details came out," said Linus Yip, strategist at First Shanghai Securities in Hong Kong. That sent real estate shares lower. Hong Kong-listed Poly Real Estate plunged 10 percent. China Resources Land nosedived 7.7 percent. China Vanke Co., listed in Shenzen, shed 6.1 percent.
South Korea's Kospi lost 0.5 percent to 2,016.18. Australia's S&P/ASX 200 lost 1.4 percent to 5,014.20.Benchmarks in Singapore, Taiwan, Indonesia and the Philippines also fell.
Japan's Nikkei 225 index reached its highest intraday level since September 2008 before retreating slightly to 11,640.64, a gain of 0.3 percent.
Investors are seemingly in a buoyant mood ahead of a leadership change at the Bank of Japan. Gov. Masaaki Shirakawa will step down March 19, making way for a new chief who supports Prime Minister Shinzo Abe's call for bolder monetary easing. The central bank meets Wednesday and Thursday for a regular monetary policy review.
A positive manufacturing report pushed Wall Street higher on Friday. The Dow Jones industrial average rose 0.3 percent to close at 14,089.66. The Standard & Poor's 500 index rose 0.2 percent to 1,518.20. The Nasdaq composite gained 0.3 percent to 3,169.74.
U.S. manufacturing expanded in February at the fastest pace since June 2011. The Institute for Supply Management said that its index of factory activity rose in February to 54.2, up from January's reading of 53.1. A reading above 50 indicates expansion.
Benchmark oil for April delivery was down 15 cents to $90.53 per barrel in electronic trading on the New York Mercantile Exchange. The contract fell $1.37 to close at $90.68 a barrel on the Nymex on Friday.
In currencies, the euro fell to $1.301 from $1.3017 late Friday in New York. The dollar fell to 93.34 yen from 93.58 yen.