By Andrew Galbraith
SHANGHAI (Reuters) - 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.
Asian shares are under pressure after North Korea cancelled high-level talks with Seoul, denouncing military exercises between South Korea and the United States, breaking from several months of easing relations on the peninsula.
"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."
South Korea's KOSPI <.KS11> was 0.4 percent lower, Japan's Nikkei <.N225> was down 0.3 percent and Australian stocks <.AXJO> edged up 0.1 percent.
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
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.
The 10-year yield
The two-year yield
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.
U.S. light crude
Brent crude oil
The dollar was mostly flat against the yen at 110.29
The US dollar index <.DXY>, which tracks the greenback against a basket of six major rivals, was up 0.05 percent at 93.270. On Tuesday, the index had hit its highest level this year, lifted by the 10-year yield.
In commodities markets, gold was slightly higher, with spot gold
(Reporting by Andrew Galbraith, additional reporting by Swati Pandey in SYDNEY; Editing by Sam Holmes)
(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)