Asian markets fell after North Korea suspends talks, U.S. yields shoot higher

Vastavam web: Asian markets fell in early trade on Wednesday after Pyongyang called off talks with Seoul, throwing a major U.S.-North Korean summit into question, and a spike in the U.S. 10-year Treasury yield to a seven-year high knocked sentiment on Wall Street.Strong U.S. retail and factory data on Tuesday pushed the U.S. 10-year yield through a key level to hit 3.095, its highest since July 2011. The rise in yields hurt U.S. share markets on concerns it would undercut stock valuations.

This has also raised concerns about the planned summit between U.S. President Donald Trump and his North Korean counterpart leader Kim Jong Un scheduled next month“This will weigh on the Korean reconstruction beneficiaries that have had a strong run on peace and even reunification hopes recently,” JPMorgan analysts wrote in a note. “The broader risk for the region if talks do break down is that Trump no longer feels the need to keep China on side and could escalate trade tensions again.”New Zealand’s S&P/NZX 50 index .NZ50 was down around 1.4 percent after earlier falling as much as 2.3 percent, after dairy company A2 Milk Ltd’s (ATM.NZ) revenue guidance fell short of analyst expectations, knocking the shares to a three-month low.

In the United States, stronger growth and the potential for steadily rising inflation have added to expectations the U.S. Federal Reserve may move to increase interest rates at a faster pace.On Wall Street, the Dow Jones Industrial Average .DJI fell 193.00 points, or 0.78 percent, to 24,706.41, the S&P 500 .SPX lost 18.68 points, or 0.68 percent, to 2,711.45 and the Nasdaq Composite .IXIC dropped 59.69 points, or 0.81 percent, to 7,351.63.

In energy markets, crude oil prices remained near recent highs amid concerns U.S. sanctions on Iran may restrict crude exports from a major producer.U.S. light crude CLc1 was 0.6 percent lower at $70.92 after reaching $71.92 on Tuesday, its highest level since November 2014.Brent crude oil LCOc1 settled at $78.43 a barrel, up 20 cents, or 0.3 percent. It earlier reached an intraday peak of $79.47 a barrel, up $1.24 and its highest since November 2014.