Investing.com - Asian Pacific markets fell in early Friday trading, following the downtrend witnessed in U.S. markets, largely due to a slump in real estate stocks.
By 11:45 am AEDT (12:45 am GMT), the S&P/ASX 200 and KOSPI 200 were down by 1.5% and 1.1% respectively, while the Nikkei 225 dipped 0.3%.
In North America, US stocks retreated as inflation data exceeded expectations. The S&P 500 slipped 0.3% to 5,150.48, the Dow Jones Industrial Average fell 0.4% to 38,905.66, and the NASDAQ Composite declined 0.3% to 16,128.53.
Investors are keenly observing inflation trends as they attempt to forecast when the Federal Reserve will initiate interest rate cuts. Jerome Powell, the Fed Chair, has stated that the central bank seeks more assurance that inflation is reverting to its 2% target before taking action. Recent data, showing a rise in producer prices and consumer prices above forecast, has dampened investor optimism about imminent rate cuts.
Consequently, the yield on the benchmark 10-year U.S. Treasury note surged to 4.297%, marking its largest one-day gain in a month. This rise has negatively impacted sectors of the stock market that investors typically flock to for their substantial dividend payments, with real estate and utilities experiencing the most significant losses.
In the tech sector, Microsoft (NASDAQ:MSFT) shares rose by 2.4%, marking their 15th record close of the year, following the announcement of the worldwide availability of its artificial-intelligence product, Copilot for Security, in the coming month. However, other tech stocks presented a mixed picture, with Apple shares (NASDAQ:AAPL) climbing 1.1% but Nvidia shares falling 3.2%.
In the commodity markets, Brent crude oil increased by 1.3% to US$85.11 a barrel, while gold fell 0.6% to US$2,162.19.
Chinese shares closed lower as investors await new catalysts after the National People's Congress meetings. Meanwhile, Hong Kong's Hang Seng Index also fell, weighed down by biotech stocks. In contrast, the Nikkei Stock Average in Japan edged 0.3% higher, erasing earlier losses due to mild risk appetite spurred by gains in U.S. stock-index futures and a weaker yen.
Indian shares ended the day on a positive note after the country's wholesale inflation rate showed a further decrease to 0.20% year-on-year in February, down from 0.27% in January.
In Europe, the performance of shares was mixed, with the STOXX Europe 600 Index, CAC 40, and DAX 40 showing varied results. The FTSE 100 closed down 0.4% at 7740.19 points on Thursday, marking an end to its three-day rising streak following U.S. wholesale inflation data that climbed more than anticipated.