Markets across the Asia-Pacific region fell on Thursday, mirroring sharp losses on Wall Street as growing concerns over a new U.S. budget bill and its potential to significantly expand the country’s debt weighed on investor sentiment.
Japan’s Nikkei 225 declined 0.84% to close at 36,985.87, while the broader Topix index slipped 0.58% to 2,717.09. In South Korea, the Kospi dropped 1.22% to 2,593.67, and the tech-heavy Kosdaq slid 0.82%, finishing at 717.67.
Australia’s S&P/ASX 200 also retreated, losing 0.45% to end the trading day at 8,348.7.
In greater China, Hong Kong’s Hang Seng Index fell 1.19% to 23,544.31, while mainland China’s CSI 300 edged down 0.06% to close at 3,913.87.
The regional declines came after a heavy sell-off in the U.S. the previous day, as investor anxiety intensified over the fiscal trajectory of the world’s largest economy. Stock futures were largely flat in overnight trading, with Dow Jones Industrial Average futures slipping by 60 points, and futures on the S&P 500 and Nasdaq 100 little changed.
In the U.S., the three major indexes posted sizable losses Wednesday. The Dow Jones Industrial Average sank 816.80 points, or 1.91%, to 41,860.44. The S&P 500 dropped 1.61% to 5,844.61, while the Nasdaq Composite fell 1.41% to close at 18,872.64.
The downturn was driven by a sharp rise in Treasury yields, signaling heightened concern among investors about the implications of increased government borrowing. The 30-year Treasury bond yield climbed to 5.09%, its highest level since October 2023. Meanwhile, the benchmark 10-year Treasury note yield was last seen at 4.59%.
Fears that the new U.S. budget bill could exacerbate the country’s already massive debt burden have triggered global risk aversion, dragging equities lower across regions.
