Asian Shares Slide On Inflation Worries

Asian stocks ended mostly lower on Tuesday as investors fretted about rising Treasury yields, the debt ceiling tussle in the United States and debt crises involving Chinese property developers, with Fantasia joining Evergrande in missing a coupon payment.

Markets in China remain shut until Friday for the Golden Week holidays. Hong Kong’s Hang Seng index rose 67.78 points, or 0.3 percent, to 24,104.15.

Japanese shares hit a one-month low as surging oil prices stoked further worries about inflation and monetary tightening globally. New Japanese Prime Minister Fumio Kishida’s proposal to raise taxes on capital gains also dented sentiment.

In economic news, Japan’s services sector activity shrank for a 20th straight month in September, a survey showed, though the pace of decline eased from the sharp contraction seen in August.

The Nikkei 225 Index tumbled 622.77 points, or 2.2 percent, to 27,822.12, while the broader Topix closed 1.3 percent lower at 1,947.75.

Fast Retailing plummeted 6.9 percent after the operator of the Uniqlo casual clothing chain reported a 19 percent drop in its existing store sales in September.

Tech shares fell across the board, with Screen Holdings, Advantest and Tokyo Electron losing 1-2 percent. SoftBank Group gave up 3.8 percent on concerns about falling values of its investment in tech firms, in particular Alibaba.

Oil companies benefited from rising crude oil prices, with Idemitsu Kosan climbing 3.7 percent and Inpex rallying 5.6 percent. Insurer Dai-ichi Life Holdings rose 1.7 percent and T&D Holdings added 1.6 percent as bond yields surged to an 18-month high.

Australian markets ended modestly lower as the Reserve bank kept interest rates on hold, as widely expected, and reiterated that it will not increase the cash rate until actual inflation is sustainably within the 2 to 3 percent target range.

The benchmark S&P/ASX 200 Index ended down 30.10 points, or 0.4 percent, at 7,248.40 after having fallen more than 1 percent earlier in the day in response to weak services sector and retail sales data. The broader All Ordinaries Index slipped 40.30 points, or 0.5 percent, to 7,536.50.

Technology stocks led losses, with buy-now-pay-later giant Afterpay plunging 5 percent to close at its lowest level in over two months. Artificial intelligence firm Appen also settled 5 percent lower at a three-and-a-half-year low.

Seoul stocks fell sharply to hit a seven-month low as traders returned to their desks after an extended holiday tied to the Oct. 3 National Foundation Day. The benchmark Kospi slumped 57.01 points, or 1.9 percent, to close at 2,962.17, marking the lowest finish since March 10.

Samsung Electronics, SK Hynix, Naver and LG Chem lost 1-3 percent. Pharmaceutical giant Samsung Biologics plummeted 7.2 percent.

New Zealand shares tumbled ahead of the Reserve Bank of New Zealand’s interest rate decision due Wednesday.

The benchmark NZX-50 index dropped 137.28 points, or 1 percent, to 13,199.99, with Fisher & Paykel Healthcare and Kathmandu Holdings falling more than 3 percent after a survey showed business confidence in the country dropped in the third quarter.

U.S. stocks fell sharply overnight as high commodity prices, a surge in Treasury yields and worries about growth rendered the underlying mood bearish.

The Dow shed 0.9 percent, the S&P 500 fell 1.3 percent and the tech-heavy Nasdaq Composite lost 2.1 percent.

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