Asian Stocks Fall as North Korea Stops Peace Talks with South Korea

By Modupe Gbadeyanka 

Asian stocks ended broadly lower on Wednesday after U.S. government bond yields surged on expectations for further interest rate hikes from the Federal Reserve and North Korea suspended talks with South Korea scheduled for later in the day, citing joint South Korea-U.S. military exercises.

Chinese stocks closed lower, with the benchmark Shanghai Composite Index sliding 22.41 points or 0.7 percent at 3,169.71. Hong Kong’s Hang Seng Index edged down 41.83 points or 0.1 percent to 31,110.20.

Japanese shares fell amid renewed geopolitical uncertainty on the Korean Peninsula. Weak GDP data also weighed on markets.

Data showed that the world’s third-biggest economy contracted a more than expected 0.6 percent in the January-March period on an annualized basis to suffer its first contraction since 2015.

The Nikkei 225 Index dropped 100.79 points or 0.4 percent to 22,717.23, while the broader Topix Index closed 0.3 percent lower at 1,800.35.

Mitsubishi UFJ Financial Group lost 2.4 percent after its net profit for the year ended in March missed analyst estimates. Nisshin Steel rallied 15.6 percent on news it will become Nippon Steel & Sumitomo Metal Corp.’s subsidiary next January via a share exchange.

Meanwhile, Australian shares eked out modest gains, led by mining and financial stocks. The benchmark S&P/ASX 200 Index rose 9.20 points or 0.2 percent to 6,107, while the broader All Ordinaries Index edged up 9.40 points at 6,208.10.

Firmer commodity prices helped lift miners, with heavyweights BHP Billiton and Rio Tinto climbing over 1 percent each. Westpac Banking Corp advanced 0.7 percent, while the other three major banks closed narrowly mixed.

Origin Energy, Santos and Woodside Petroleum climbed 1-2 percent after crude oil prices advanced overnight, but gold miners Newcrest and Evolution fell around 2 percent after gold prices tumbled overnight.

Myer Holdings soared as much as 16 percent even as the embattled department store chain reported a 2.7 percent decline in third quarter sales and warned that unseasonably warm weather may hurt its fourth-quarter profits.

Investors shrugged off figures from the Australian Bureau of Statistics showing Australia’s wages grew less than expected in the three months ended in March.