Asian stocks ended mixed on Tuesday as sentiment was weakened by Covid-19 woes and a surge in U.S. Treasury bond yields.
The U.S. 10-year and 5-year Treasury yields refreshed two-year highs and the 2-year bond coupon jumped to the February 2020 levels at the latest amid bets on the Federal Reserve’s faster rate hikes in 2022. Fed funds futures are priced for a hike in March and four hikes this year.
Chinese shares rose notably as the cut of two key policy interest rates opened the door to more monetary easing actions ahead. The benchmark Shanghai Composite index climbed 28.25 points, or 0.80 percent, to 3,569.91 while Hong Kong’s Hang Seng index ended down 105.25 points, or 0.43 percent, at 24,112.78.
Japanese shares ended slightly lower as the Bank of Japan maintained its monetary policy stimulus unchanged and lifted its inflation forecast for the next fiscal year, citing a rise in commodity prices.
The Nikkei average dipped 76.27 points, or 0.27 percent, to 28,257.25 while the broader Topix index closed 0.42 percent lower at 1,978.38.
Japan Steel Works, Kobe Steel and JFE Holdings slumped 5-7 percent while Chiyoda Corp and West Japan Railway climbed 2-3 percent.
The Japanese government is set to decide as early as Wednesday to apply quasi-emergency priority measures to 13 prefectures, including Tokyo, Kanagawa and Aichi, where infections with the novel coronavirus are rapidly spreading.
Australian stocks slipped as the country reported a record high of Covid-19 deaths. Weak economic data also dented sentiment, with a measure of consumer confidence in the country falling to its lowest since October 2020.
The benchmark S&P/ASX 200 slipped 8.50 points, or 0.11 percent, to 7,408.80 while the broader All Ordinaries index finished marginally lower at 7,735.80.
A softer U.S. dollar weighed on the healthcare sector, with CSL losing 1.6 percent.
Rio Tinto shed 0.4 percent after the world’s biggest iron ore producer forecast weaker-than-expected 2022 iron ore shipments. Rival BHP rose 1.2 percent and South32 climbed 2.5 percent.
Seoul stocks extended losses to a fourth consecutive session amid inflation woes at home and in the United States. The Kospi average dropped 25.86 points, or 0.89 percent, to close at 2,864.24.
Internet portal operator Naver declined 1.6 percent, chemical firm LG Chem lost 1.8 percent and pharmaceutical giant Samsung Biologics gave up 2.4 percent while battery maker Samsung SDI soared 5.3 percent and oil refiner SK Innovation added 2.6 percent.
New Zealand’s NZX 50 ended marginally higher at 12,814.46, even as a survey showed business confidence and demand weakened in the fourth quarter of 2021.
U.S. markets were closed on Monday in observance of the Martin Luther King Jr. Day holiday.
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