Asian Shares Decline as US Treasury Yields Hit 2002 Highs

Asian equity markets declined on Friday, with the MSCI index of Asia-Pacific shares outside Japan falling 0.5% and the Nikkei dropping 0.7%. This downturn follows significant volatility in global bond markets, where the benchmark 10-year US Treasury yield reached 5.3445%, its highest level since 2002, after recording its largest quarterly increase in 32 years. While yields later retreated to 5.2575%, the pressure remains significant.

Financial stress is also appearing in Europe, where fiscal concerns in France pushed the spread between French and German sovereign bond yields to 140 basis points, the widest gap since 2012. The euro subsequently fell to $1.1215, its lowest point since May 2025. Meanwhile, global oil prices remain elevated at $92.84 a barrel for US West Texas Intermediate crude, driven by reports of increased US military deployments to the Middle East and China's suspension of oil product exports.

Investors are currently awaiting US nonfarm payroll data, with forecasts anticipating 90,000 new jobs in September and a steady unemployment rate of 4.1%. Market participants are closely monitoring hourly earnings for signs of inflation, as the Federal Reserve weighs future interest rate decisions.

What to watch: The release of the US nonfarm payrolls report later today.

Editor's note: The draft effectively synthesizes the market data and economic context provided in the source text.

This article is AI-generated and fact-gated. Original reporting: BS Personal Finance