Asian Markets Pared Gains, Treasuries Extended Sell-Off as Market Weighs Headwinds from Inflation and Geo-Politics

Asian markets pared gains while bonds extends selloff as traders weigh risk of inflationary pressure and impact of war in Ukraine.

The CSI300, HSI and KOSPI inched down by 0.59%, 0.94% and 0.20% respectively while SET and TOPIX closed marginally higher by 0.18% and 0.14% respectively.

Shares in Russia advanced as they partially resumed trading after being closed for almost a month.

U.S. equity futures pointed higher after the S&P 500 closed 1.2% lower Wednesday. Shares in Russia advanced as the Moscow Exchange open after almost a month with floor restrictions in place.

U.S. treasuries extended loss while the yield curve reached its flattest level in 15 years.

“Markets are really latching onto these short-lived themes and that’s causing significant price movement,” Tracie McMillion, head of global asset allocation strategy at Wells Fargo Investment Institute, said on Bloomberg Radio.

“We think that for the near term we are probably going to be able to avoid a recession but we are growing a little bit more concerned about 2023.”

Crude oil ticked on optimism from Iran deal with WTI trading around $114 a barrel while Brent is trading around $121 a barrel.

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