Asia Mixed as Focus Remains Treasury Yields

Stocks in major Asian markets were mixed on Thursday as investors continued to watch the yield curve in U.S. Treasurys, which inverted further overnight.

In Tokyo, the Nikkei 225 index moved backward 18.49 points, or 0.1%, to close Thursday at 20,460.93.

The Japanese yen traded at 106.08 against the U.S. dollar after seeing lows around 106.2 yesterday.

In Hong Kong, the Hang Seng Index regained 88.02 points, or 0.3%, to 25,703.50

In corporate news, shares of companies under South Korean conglomerate Samsung dropped on Thursday after the country’s Supreme Court overturned part of an appeals court ruling in the bribery case involving the group’s de facto chief Jay. Y Lee.

Samsung Electronics saw its stock drop 1.7%, while Samsung C&T plunged 4.1% and Samsung Biologics plummeted 4.9%.

The latest ruling raises questions over Lee’s ability to lead Samsung Electronics as it faces falling profitability issues and challenges surrounding a Japanese ban on the export of crucial materials for South Korea’s technology sector. He was freed from detention in February 2018 after his original sentence of a five year imprisonment was halved and suspended for four years.

Investors continued to monitor the yields in U.S. Treasurys. The 30-year bond yield fell to a new record low of 1.907% on Wednesday before seeing a recovery. It was last at 1.9607%.

The closely-watched yield spread between the 10-year Treasury note and 2-year note also widened further on Wednesday, extending losses from the previous session where it touched its lowest level since 2007. The phenomenon, also known as a yield curve inversion, has historically preceded periods of recession.

The yield on the 10-year Treasury note was at 1.4844% and the two-year note was last at 1.5119%.

The Australian dollar changed hands at $0.6735, off highs above $0.676 touched earlier in the trading week.

CHINA

In Shanghai, the CSI 300 lost 12.39 points, or 0.3%, to 3,709.19

The Chinese yuan briefly weakened past 7.17 against the U.S. dollar for the first time in more than 11-and-a-half years on Thursday, before making a recovery in the afternoon of Asian trading hours. It last traded at 7.1572.

The People’s Bank of China had set the official midpoint reference for the yuan at 7.0858 on Thursday morning. Meanwhile, offshore trading of the yuan was last at 7.1611 per dollar.

In other markets

In Korea, the Kospi index subtracted 7.68 points, or 0.4%, to 1,933.41

In Taiwan, the Taiex advanced 28.14 points, or 0.3%, to 10,462.43

In Singapore, the Straits Times Index rebounded 25.36 points, or 0.8%, to 3,081.83

In New Zealand, the NZX 50 stepped back 46.1 points, or 0.4%, to 10,580.07

In Australia, the ASX 200 eked up 6.76 points, or 0.1%, to 6,507.40