HONG KONG- Asian stocks slipped on Wednesday following a mixed Wall Street session as higher US Treasury yields weighed on global tech firms and pushed the dollar to a five-year high against Japan’s yen.
US yields rose on Tuesday as bond investors geared up for interest rate hikes from the Federal Reserve by mid-year to curb stubbornly high inflation.
MSCI’s broadest index of Asia-Pacific shares outside Japan lost 0.8 percent, while Japan’s Nikkei was little changed.
US stock futures also slipped with S&P 500 e-minis down 0.25 percent and Nasdaq e-minis losing 0.4 percent.
“From Asia’s perspective, it’s a slightly more risk-off tone because it’s one of those days where higher bond yields are a bad thing, as, even though they reflect a stronger US backdrop, they tend to be supportive of the dollar rather than local currencies,” said Rob Carnell, head of Asia Pacific research at ING.
“But it’s pretty choppy, tomorrow we might get back to thinking the higher yields reflect a stronger global backdrop,” Carnell said.
He said overnight declines in the Nasdaq due to the higher yields weighed on Asian share markets given the greater significance of tech stocks in the region.
Hong Kong-listed tech stocks lost 3.7 percent in early trade while in Japan, Nintendo slipped 1 percent and in South Korea, Samsung shed 2 percent ahead of its quarterly results.
US shares were mixed on Tuesday with the tech-heavy Nasdaq losing 1.3 percent, though rising yields boosted banks and industrial names helped the Dow Jones Industrial Average to a record closing high and the S&P 500 to touch an all-time intraday high. — Reuters
