Asian Shares Tumble As Bond Yields Surge

Asian stocks hit one-month lows on Friday as a rout in global bond markets sent yields flying and sapped investors’ appetite for riskier assets.

China’s Shanghai Composite Index tumbled 75.97 points, or 2.1 percent, to 3,509.08 amid a global equity market rout. Hong Kong’s Hang Seng Index ended down 1,093.96 points, or 3.6 percent, at 28,980.21.

Japanese shares led regional losses as a spike in yields of U.S. and Japanese long-term bonds triggered concerns about market stability. The Nikkei 225 Index plummeted 1,202.26 points, or 4 percent, to 28,966.01, logging the biggest point drop since June 2016.

The broader Topix ended down 61.74 points, or 3.2 percent, at 1,864.49, with electric appliance, pulp and paper and real estate issues pacing the decliners. Taiyo Yuden, Dentsu, Pacific Metals, Advantest and Nissan Chemical Industries fell 6-8 percent.

On the economic front, Japanese industrial output rose 4.2 percent sequentially in January, while retail sales dropped 2.4 percent year-on-year, separate reports showed.

Australian markets ended sharply lower, with surging U.S bond yields, weaker bullion prices and a sell-off in high-flying tech stocks weighing on the markets. Yields came off early peaks as the Reserve Bank of Australia launched an unscheduled offer to buy three-year government bonds.

The benchmark S&P/ASX 200 Index plunged 160.70 points, or 2.4 percent, to 6.673.30 – marking its worst session in about six months and hitting a nearly four-week low. The broader All Ordinaries Index dove 165.10 points, or 2.3 percent, to finish at 6,940.60.

Tech stocks succumbed to heavy selling pressure, with Afterpay losing 11 percent. Mining heavyweights BHP and Rio Tinto fell 2.6 percent and 1.3 percent, respectively, while smaller rival Fortescue Metals Group lost 4.5 percent.

Origin Energy and Woodside Petroleum tumbled more than 3 percent as oil prices fell amid dollar strength. The big four banks fell over 2 percent each.

Commercial explosive firm Orica slumped 18 percent after flagging pandemic-related disruptions to mining activity in several regions.

Seoul stocks lost ground on worries about a possible spike in inflation. The Kospi ended down 86.74 points, or 2.8 percent, at 3,012.95. LG Chem shares plunged 6.6 percent, while Samsung Biologics, Samsung Electronics and SK Hynix gave up 3-5 percent.

Meanwhile, New Zealand shares ended higher to snap a six-day decline after Reserve Bank of New Zealand Governor Adrian Orr reiterated that the bank will maintain its current easy policy setting for a prolonged period.

The benchmark NX-50 Index climbed 86.63 points, or 0.7 percent, to 12,227.29. Heavyweight A2 Milk Company rose 3.8 percent after falling as much as 16 percent the previous day.

New Zealand had a merchandise trade deficit of NZ$626 million in January, Statistics New Zealand said in a report, following the NZ$69 million surplus in December.

U.S. stocks tumbled overnight as U.S. Treasury yields hit a new 52-week high after the release of a batch of largely upbeat data on GDP, jobless claims and new orders for manufactured durable goods.

The tech-heavy Nasdaq Composite plunged 3.5 percent to reach its lowest closing level in nearly a month, while the Dow Jones Industrial Average lost 1.8 percent and the S&P 500 shed 2.5 percent.

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