Asian markets open lower on AI stock rout, rising US yields

Mettis Global reported that Asian stock indices started Tuesday lower as a retreat from artificial intelligence shares, firmer US bond yields and high crude prices dented sentiment. Japan's Nikkei 225 slid 0.25 per cent during early dealings, the Topix dropped 0.24 per cent and South Korea's Kospi shed 0.43 per cent. Australia's ASX 200 also opened weaker, down 0.46 per cent.

Earlier, Wall Street closed lower as investors sold AI-linked companies over worries about the pace of development and rising safety risks, CNBC reported. Nvidia fell about 3 per cent and Corning lost 13 per cent. The 10-year US Treasury yield briefly topped 5 per cent on Monday, its highest since October 2023, and Brent crude settled above $105 a barrel after Saudi Arabia halted a major pipeline that avoids the Strait of Hormuz.

The US Federal Reserve decides on Wednesday, with futures pricing roughly a 92 per cent chance of a quarter-point increase from the 3.5 to 3.75 per cent range. Christopher Hodge, chief US economist at Natixis CIB Americas, expects the central bank to lift its benchmark to 4.0 per cent this week. Trading later turned mixed, with Japan's Nikkei up 0.6 per cent while Hong Kong's Hang Seng fell 0.3 per cent and the ASX 200 lost 0.7 per cent.