Asian stocks slump amid risks from U.S. CPI, China COVID struggle

Asian stocks sank on Monday and bond yields ticked higher, as red-hot U.S. inflation reignited worries about even more aggressive Federal Reserve policy tightening, and a COVID-19 warning from Beijing added to concerns about global growth, Reuters reported.

Chinese blue chips dropped 0.84%, and Hong Kong’s Hang Seng suffered a 2.9% slide.

Japan’s Nikkei slumped 2.78%, and South Korea’s Kospi declined 2.78%.

New Zealand’s stock benchmark was off 2.1%. Australian markets were closed for a holiday.

U.S. stock futures pointed to further losses at the reopen, with the S&P 500 indicating 1.54% lower, after Friday’s 2.91% retreat.

The dollar hit 135 yen for the first time in two decades, buoyed by a rise in Treasury yields that continued into Tokyo trading, with the 10-year reaching a more than one-month peak of 3.201%, putting it just two-tenths of a basis point from the highest since November 2018.