Asian markets fell on Wednesday as inflation concerns continued to hammer global bond markets and fuel expectations of further US interest rate rises.
The sell-off in sovereign debt intensified overnight, with investors increasing bets that the Federal Reserve may still need to tighten monetary policy later this year.
The benchmark US 10-year Treasury yield climbed to a 16-month high of 4.69%, while the 30-year yield approached 5.2%, levels not seen since 2007.
Oil prices remained elevated despite US President Donald Trump postponing planned military action against Iran to allow more time for negotiations, helping Wall Street recover part of its earlier losses.
In Beijing, Chinese President Xi Jinping held talks with Russian President Vladimir Putin, with both leaders stressing the need to prevent further escalation in the Middle East conflict.
MSCI’s broadest Asia-Pacific index outside Japan fell 0.7%, marking its fourth consecutive day of losses, while Japan’s Nikkei 225 dropped 1.5% for a fifth straight decline.
South Korea’s Kospi lost 1.7%, pressured by weakness in semiconductor shares after workers at Samsung Electronics announced plans for an 18-day strike beginning Thursday, raising concerns over global chip supply disruption.
China’s CSI300 index was broadly flat, while Hong Kong’s Hang Seng slipped 0.6%.
On Wall Street overnight, the S&P 500 edged 0.1% lower to 5,963.18, while the Nasdaq Composite fell 0.5% as investors reduced exposure to semiconductor stocks ahead of earnings from NVIDIA.
The Dow Jones Industrial Average outperformed, rising 0.3% as investors rotated into more defensive sectors.
