Currencies and Asian Stocks Drop as Risk Mood Turns – Asia Market Wrap

Asia’s stocks and currencies fell on Thursday as risk appetite was restrained by US Treasury yields that are still close to this year’s peak.

The MSCI Asia Pacific Index fell to a three-week low as a result of the region’s losses, which were mostly felt by South Korea and Japan. In Asian trading, US stock futures contracts also declined. A gauge of Hong Kong-based Chinese technology shares approached a technical correction.

Following weak demand in the $44 billion auction of seven-year securities the previous session, Treasury bonds fell across the curve, although they steadied in Asian trading. The outcome increased concerns that yields will rise in an environment where the Federal Reserve is not in a hurry to lower rates in order to finance the US deficit. Yields in Australia increased.

Rising Treasury yields have pushed the dollar higher, impacting Asian currencies. For the third consecutive session, an index of dollar strength rose. Global markets are poised for their worst week since mid-April.