Asian markets mixed and Japan's shares slip after election leaves PM future in doubt

BANGKOK -- Asian shares were mixed on Tuesday after U.S. stock indexes inched to more records at the start of a week of profit updates from big U.S. companies.

Japan’s benchmark surged and then fell back as it reopened from a holiday Monday following the ruling coalition's loss of its upper house majority in Sunday's election.

The Nikkei 225 shed 0.3% to 39,694.89.

Analysts said the market initially climbed as investors were relieved that Prime Minister Shigeru Ishiba vowed to stay in office despite the setback. But the election's outcome has added to political uncertainty and left his government without the heft needed to push through legislation.

A breakthrough in trade talks with the U.S. might win Ishiba a reprieve, but so far there's been scant sign of progress in negotiating away the threat of higher tariffs on Japan's exports to the U.S. beginning Aug. 1.

“Relief may be fleeting. Ishiba’s claim to leadership now rests on political duct tape, and history isn’t on his side. The last three LDP leaders who lost the upper house didn’t last two months,” Stephen Innes of SPI Asset Management said in a commentary.

Elsewhere in Asia, Hong Kong's Hang Seng rose 0.3% to 25,057.11, while the Shanghai Composite index also was up 0.3%, at 3,568.78.

South Korea's Kospi sank 1.4% to 3,165.40, with investors concerned over the Aug. 1 deadline for making a deal with U.S. President Donald Trump or facing 25% tariffs on all the country's exports to the U.S.

Australia's S&P/ASX 200 was little changed at 8,666.30.

India's Sensex gained 0.3%, while the SET in Thailand was up less than 0.1%.

Many of Trump’s stiff proposed tariffs are paused after he extended the deadline for talks to allow more time to reach potential trade deals that could lower those rates. Aug. 1 is the next big deadline, at least for now.

U.S. stock indexes inched their way to more records on Monday to kick off a week full of profit updates from big U.S. companies.

General Motors will report its latest profit results later this week, along with such market heavyweights as Alphabet, Coca-Cola and Tesla.

The S&P 500 rose 0.1% to 6,305.60 and squeaked past its prior all-time high set on Thursday. The Dow Jones Industrial Average edged down less than 0.1% to 44,323.07.

The Nasdaq composite added 0.4% to its own record, closing at 20,974.17.

Verizon Communications helped lead the way and rose 4%. The telecom giant reported a stronger profit and higher revenue for the latest quarter than expected and raised its forecasts for the full year.

That helped offset a 5.4% drop for Sarepta Therapeutics, which continued to fall after the Food and Drug Administration said on Friday that it asked the company to voluntarily stop all shipments of Elevidys, its gene therapy for Duchenne muscular dystrophy, due to safety concerns.

Block, Jack Dorsey’s company behind Square, Cash App and other tech brands climbed 7.6% in its first trading after learning it will join the widely followed and imitated S&P 500 index. It will take the place of Hess, which Chevron bought, before trading begins on Wednesday.

Cleveland-Cliffs rallied 12.4% after the steel producer reported a smaller loss for the spring than analysts expected. It shipped a record 4.3 million net tons of steel during the quarter, and CEO Lourenco Goncalves said the company has begun to see “the positive impact that tariffs have on domestic manufacturing” and other things.

It’s a major supplier to the auto industry, and Trump’s tariffs steer companies hoping to sell cars in the United States toward steel made in the country.

In other dealings early Tuesday, U.S. benchmark crude oil lost 71 cents to $65.24 per barrel, while Brent crude, the international standard, gave up 69 cents to $68.52 per barrel.

The U.S. dollar rose to 147.62 Japanese yen from 147.38 yen. The euro slipped to $1.1691 from $1.1696.

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AP Business Writers Matt Ott and Stan Choe contributed.