Asian stocks drop on surging bond yields, geopolitical tensions

• Asian stocks are flashing red, tracking the rising yield-led risk aversion in the US equities.
• Renewed tensions in the Korean peninsula may have added to the bearish pressure around stocks.

Asian stocks are reporting losses after Wall Street experienced its worst day in three weeks, courtesy of rising treasury yields.

Scorecard

• Japan's Nikkei is down 0.37 percent and stocks in New Zealand are down 1.33 percent.
• Shanghai Composite is reporting a 0.4 percent drop.
• Hong Kong's Hang Seng is down almost 1 percent.
• South Korea's Kospi and Australia's S&P/ASX 200 are reporting moderate gains.

The weak tone could be associated with the risk aversion noted in the US stocks. The Dow Jones Industrial Average halted a four-day winning streak and fell 193 points as the yield on the 10-year Treasury notes rose to 3.09 percent, the highest since 2011, after upbeat U.S. retail sales figure boosted expectations of faster Fed rate hikes.

Kospi is mildly bid despite reports that North Korea has suspended talks with North Korea. Further, North Korea has threatened to call off the planned summit with the US President Trump in response to joint military exercise by the United States and South Korea.

The renewed tensions in the Korean peninsula could add to the bearish pressure around the equities.