Investing.com - Asian Pacific indices opened lower on Friday, following overnight losses among major US averages. This comes in light of the steady unemployment rates in the US, which have reinforced predictions of persistent high-interest rates.
By 10:20 am AEST (12:20 am GMT), the ASX 200, Kospi 200, and Nikkei 225 each experienced a dip of 0.4%, 1.8%, and 1.9% respectively.
The market's reaction is largely attributed to investors adjusting to the possibility of prolonged high-interest rates as bond yields rise and stocks mostly slump. The S&P 500 and Nasdaq Composite have both lost nearly 5% in April, while the Dow Jones Industrial Average saw a minor gain.
10-year Treasury notes rose to 4.646%. The market opened high due to a wave of corporate earnings reports and strong economic data, including a robust labor market and increasing business activity. However, afternoon trading saw a retreat in major stock indexes.
Investor sentiment has been affected by hotter-than-expected inflation data, which suggests a higher rate of inflation than the Federal Reserve's target of 2%. This has led to a re-evaluation of the risks associated with owning volatile assets like tech stocks and has negatively impacted rate-sensitive sectors like real estate.
In commodity markets, Brent crude oil experienced a 0.4% dip to US$86.97 a barrel, while gold saw an increase of 0.8% to US$2,379.04. Cocoa prices continue to rise due to poor weather conditions in West Africa and speculators entering one of the year's hottest trades. Copper futures also saw a rise of 2.3% to $4.4405 a pound, the highest price in nearly two years.
In the local bond market, the yield on Australian 2 Year government bonds fell to 3.91%, and the 10 Year yield also fell to 4.28%. US Treasury notes were up, with the 2 Year yield at 4.99% and the 10 Year yield at 4.63%.
Chinese shares ended lower, mainly due to declines in energy and semiconductor shares. PetroChina dropped 2.8% and Cnooc was 2.0% lower. However, the insurance and banking stocks provided a lift, with China Life Insurance up 3.3% and Industrial & Commercial Bank of China rising 0.4%.
Hong Kong's Hang Seng Index closed 0.8% higher at 16385.87. Energy stocks fell as oil prices edged lower, with Cnooc down 2.2%, PetroChina 1.5% lower and China Resources Power shedding 0.8%.
Japanese stocks ended lower, with significant falls in tech and real-estate stocks. Tokyo Electron was down 2.8%, SoftBank Group was off 3.2%, Mitsubishi Estate was down 2.7% and Mitsui Fudosan was 3.0% lower. The Nikkei Stock Average was down 0.8% at 37660.48.
Indian shares closed lower, dragged by bank and auto stocks. Axis Bank and Tata Motors were down 2.7% and 2.1%, respectively. ICICI Bank lost 1.1%. Among the few gainers, Bharti Airtel rose 4.15% and Power Grid Corp. of India was up 2.1%. The benchmark Sensex closed 0.6% lower at 72488.99.
European shares closed higher on Thursday, with the pan-European Stoxx Europe 600 up 0.24% to 499.70, the CAC 40 gaining 0.52% to 8,023.26 and Germany's DAX adding 0.38% to 17,837.40. The FTSE 100 closed up 0.75% to finish at 7,877.05.