Asian markets mixed after Wall St bond sell-off

BEIJING (AP) — Asian stock markets were mixed Tuesday after a bond sell-off on Wall Street fueled anxiety about a possible U.S. economic slowdown and Australia raised interest rates.

Shanghai and Tokyo advanced while Hong Kong and Seoul declined. The yen, trading at two-decade lows, fell further to below 132 to the dollar.

Wall Street's benchmark S&P 500 index rose 0.3% on Monday and the market price of a 10-year Treasury bond fell. That increased its yield, or the difference between the day's price and the payout at maturity.

The difference between the short- and long-term Treasury yields is narrowing, which is “making me a little nervous,” because it suggests investors think a U.S. recession is more likely, said Jeffrey Halley of Oanda in a report.

“I don’t think the U.S. is at stagflation yet,” or a period with high inflation and low growth, “but if oil stays above $120.00 a barrel, it might soon be,” Halley said.

The Shanghai Composite Index advanced 0.2% to 3,243.17 after Chinese authorities eased anti-virus restrictions that shut down businesses in Shanghai and other major cities.

The Nikkei 225 in Tokyo gained 0.4% to 28,032.94 while the Hang Seng in Hong Kong shed 0.5% to 21,544.06.

Sydney’s S&P-ASX 200 sank 1.4% to 7,110.00 after the Australian central bank raised a key interest rate by 0.5 percentage points, its biggest margin in 22 years, to cool inflation that is at a two-decade high.

The Kospi in Seoul tumbled 1.6% to 2,628.61 and India's Sensex opened down 1.1% at 55,060.01. New Zealand and Singapore declined while Jakarta advanced.

Markets are swinging between gains and losses as investors weigh evidence about whether the Fed's rate hikes can cool inflation that is running at a four-decade high without tipping the U.S. economy into recession.

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