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US deadlock hits markets in Asia

Lack of progress in negotiations for a deal to avoid a US budget crisis before a January deadline has sent Asian stock markets lower.

President Barack Obama and US politicians have until January 1 to reach a deal to trim the country's unwieldy deficit.

Otherwise, a series of automatic tax increases and sharp spending cuts will take effect that could drag the world's top economy into recession.

A high-ranking member of the US Senate unnerved investors and sent Wall Street lower on Tuesday after expressing frustration over the budget impasse and the looming "fiscal cliff".

Japan's Nikkei 225 index fell 0.8% to 9,348.55, a day after closing at a seven-month high. South Korea's Kospi shed 0.8% to 1,909.56 and Australia's S&P/ASX 200 lost 0.5% to 4,434.90. Hong Kong's Hang Seng fell 0.8% to 21,672.98.

Mr Obama plans to make a public case this week for his strategy for dealing with the issue as he pressures opposing politicians to allow tax increases on the wealthy while extending tax cuts for families earning 250,000 US dollars or less.


From Belfast Telegraph