Emerging markets across Asia are getting beaten up

Fernando Lavoz/NurPhoto via Getty Images
  • Asian stocks are getting sold off and emerging market currencies are under pressure following last night’s spike in US bond yields.
  • Benchmark US 10-year bonds have climbed above 3.2% in Asian trade for the first time since 2011.

The fallout from last night’s selloff in US bond markets is being felt across Asia today.

Benchmark US 10-year yields surged to 3.18% overnight — the highest level since 2011. It followed another round of strong economic data, as speculation mounts that inflationary forces in the US economy are building.

The move in bonds gave rise to renewed strength in the US dollar, while crude oil prices briefly climbed above $US86 for the first time since October 2014.

Perhaps not surprisingly, that trio of factors weighed on emerging markets across Asia today.

Chinese markets are closed, but Hong Kong’s Hang Seng index has been belted, while India’s Nifty Fifty index is also deep in the red.

Here’s a summary of the price action in Asian stock markets

Australia ASX 200 6176.30 , 0.49%
NZ NZX 50 9257.18 , -0.40%
Japan TOPIX 1801.19 , -0.09%
HK Hang Seng 26570.14 , -1.92%
Sth Korea KOSPI 2274.37 , -1.52%
Sinagpore STI 3232.22 , -1.08%
Taiwan TAIEX 10718.91 , -1.33%
Philippines PSI 7147.9 , -0.87%
Indonesia JKSE 5768.07 , -1.70%
Malaysia KLCI Index 1792.44 , -0.21%
Thailand SET 1733.72 , -0.47%
India Nifty 50 10631.3 , -2.09%
S&P 500 Futures 2916.25 , -0.52%

Australia’s ASX200 index has outperformed its regional neighbours, with a possible boost from the Aussie dollar’s sharp fall after the USD strengthened overnight.

The Aussie dipped below US71 cents this morning and is sliding further in afternoon trade, a short time ago holding just above 0.7082 US cents.

Along with the falls in stocks, EM currencies are also under pressure again as broader strength in the US dollar reverberates through global markets.

As the US Fed raises interest rates, the pending withdrawal of US dollar liquidity from the global financial system has seen many EM currencies fall to new record lows against the greenback in recent months.

And with with outlook for Fed policy now turning increasingly hawkish, that trend has continued in Asian markets today:

AUD/USD 0.7078 , -0.34%
NZD/USD 0.6485 , -0.43%
USD/JPY 114.37 , -0.14%
USD/CNY 6.8680 , -0.29%
USD/CNH 6.9021 , 0.20%
USD/HKD 7.8377 , 0.00%
USD/KRW 1130 , 0.47%
USD/SGD 1.3816 , 0.15%
USD/TWD 30.81 , 0.27%
USD/PHP 54.35 , 0.18%
USD/MYR 4.147 , 0.24%
USD/IDR 15180 , 0.73%
USD/THB 32.63 , 0.40%
USD/INR 73.74 , 0.55%
US Dollar Index 96.05 , 0.30%

US bond yields have continued to rise in Asian trade, with US 10-years now sitting above 3.2%.

A short time ago, S&P500 futures were trading around 16 points lower, indicating a fall of around 0.5% when US markets open later tonight.

NOW WATCH: Money & Markets videos

Business Insider Emails & Alerts

Site highlights each day to your inbox.

Follow Business Insider Australia on Facebook, Twitter, LinkedIn, and Instagram.