Stock Market in Asia Dips Due to Increasing Bond Rates and Tariff Uncertainty

Global Markets Suffer Losses Amidst Uncertainty

In a turbulent start to September, global stock markets experienced losses across various regions on Thursday. The Nikkei 225 Index in Japan slid 0.9 percent, while the broader Topix Index tumbled 1.1 percent. Japanese markets ended lower on Wednesday as well.

In South Korea, several companies faced stock price losses at market close. Naver fell by 0.21 percent, Lotte Chemical dropped 0.75 percent, POSCO Holdings declined 0.88 percent, KEPCO stumbled 2.97 percent, and Hyundai Mobis slumped 0.94 percent. New Zealand's S&P/NZX-50 Index closed lower for the first time in five days, falling 0.4 percent to 13,074.81.

Australian markets continued their downward trend for the fourth consecutive day. The benchmark S&P/ASX 200 Index slumped 1.8 percent, and the broader All Ordinaries Index settled 1.7 percent lower. Tech stocks in Australia bore the brunt of the selling, with accounting software provider Xero plummeting 6.2 percent.

Meanwhile, Wall Street started the month on a sour note due to rising pressure from the bond market and weak data. The tech-heavy Nasdaq Composite ended 0.8 percent lower after having slumped nearly 1.5 percent earlier. The S&P 500 declined 0.7 percent and the Dow fell 0.6 percent. U.S. factory activity contracted in August for a sixth straight month, impacted by import tariffs.

The Australian GDP grew an annual 1.8 percent in the June quarter, but this was not enough to offset the losses seen in other markets. Gold hovered near record levels at $3,535 per ounce on Fed rate-cut bets, while oil edged lower after rising more than 1 percent in the previous session due to U.S. sanctions on a network of companies and vessels transporting Iranian oil.

Investors reacted to reports suggesting that the ruling party is set to call for early party elections. This uncertainty added to the market volatility. President Trump's bid to fire Fed Governor Lisa Cook raised alarms over central bank independence, further contributing to the market turbulence.

The dollar rose in Asian trading due to risk-off sentiment, rising bond yields, and renewed trade uncertainty. Mitsubishi UFJ Financial Group and Mizuho Financial Group both plummeted over 3 percent in Japan, while Ebos and A2 Milk declined 2-3 percent in New Zealand.

As the month progresses, it remains to be seen how these market trends will unfold and whether they will recover from the current slump.