Stocks, currencies and bonds across Asia slumped on Thursday, as US Treasury yields near this year’s high underscored uncertainty over the timing of interest-rate cuts.
Japanese and South Korean equities led losses in the region, with the MSCI Asia Pacific Index down to its lowest in three weeks. Futures contracts for US stocks also slipped in Asian trading.
Treasuries steadied after falling across the curve in the previous session following tepid demand in the $44 billion sale of seven-year securities.
The result boosted worries that funding the US deficit will drive up yields at a time when the Federal Reserve is in no rush to cut rates.
Japanese, Australian and New Zealand debt tracked the moves early Thursday. “Strong year-to-date performance is now facing increasing uncertainty heading into summer,” said Kieran Calder, head of Asia research at Union Bancaire Privee, referring to stocks. Calder foresees more profit taking as investors await key economic data in the US on Friday and a monetary policy decision in Europe next week.
