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Asian stocks followed U.S. peers lower after Federal Reserve Chairman Jerome Powell refrained from pushing back against the recent surge in bond yields. Treasuries held a decline.

Equities fell in Japan, South Korea and Australia after the S&P 500 erased nearly all its 2021 gains. The Nasdaq 100 extended losses to almost 10% from February’s high, and small caps fell roughly 3%. S&P 500 and Nasdaq 100 futures both slipped.

Australian bond yields pushed higher, tracking a jump in the 10-year Treasury to 1.56% that lifted the yield curve to its steepest point since 2015. The U.S. dollar strengthened, pushing Japan’s yen to an eight-month low.

Oil prices leapt after the OPEC+ alliance surprised traders with its decision to keep output unchanged, signaling a tighter market in the months ahead. Bitcoin fell with other risk assets.

Powell noted the recent runup in yields without hinting at intervention, saying that he would be “concerned by disorderly conditions." While some investors view the rates moves as a sign of economic strength, others are growing concerned about rising inflation and the impact of higher yields on elevated stock valuations.

“It makes logical and intuitive sense that Treasury yields should move back up to 1.50% or 2%, but we are concerned with the rest of the market about the speed at which it’s getting there," said Mona Mahajan, investment strategist at Allianz Global Investors LLC.

Stock-Market Momentum Comeuppance Gets No Sympathy From the Fed

Meanwhile, the U.S. Senate voted to take up a $1.9 trillion relief bill backed by President Joe Biden, setting off a debate expected to end this weekend with approval of the nation’s sixth stimulus since the pandemic-triggered lockdowns that began a year ago.

Elsewhere, China’s annual National People’s Congress gets under way, to review its 14th-five year plan and set long-term goals.

The February U.S. employment report on Friday will provide an update on the speed and direction of the nation’s labor market recovery.

These are some of the main moves in markets as of 9:32 a.m. in Tokyo:

Stocks

• S&P 500 futures dropped 0.4%. The gauge retreated 1.3% on Thursday.

• Japan’s Topix index slid 1%.

• South Korea’s Kospi index fell 1.6%.

• Australia’s S&P/ASX 200 declined 1.3%.

• Hang Seng futures earlier dropped 1.2%.

Currencies

• The Bloomberg Dollar Spot Index rose less than 0.1%.

• The euro dipped 0.1% to $1.1961.

• The Japanese yen added 0.1% to 107.90 per dollar.

Bonds

• The yield on 10-year Treasuries rose about one basis points to 1.57%.

• Australia’s 10-year yield rose seven basis points to 1.85%.

Commodities

• West Texas Intermediate crude jumped 0.4% to $64.07 a barrel.

• Gold dropped 0.4% to $1,691.49 an ounce.

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