Asian markets extend Wall Street fall with South Korea leading the sell-off

Global stocks extended losses after suffering their steepest drop in nearly a month on concerns over elevated valuations. Bonds extended gains and investors sought the safety of haven currencies such as the yen.US equity-index futures slipped in early Asian trading, signaling further losses for the S&P 500 and Nasdaq 100 indexes after the gauges pulled back with tech shares hit the hardest. Sentiment was further dented as Super Micro Computer Inc. shares tumbled in late trading and Advanced Micro Devices Inc. failed to impress investors with its revenue forecast. Asian shares also opened lower, led by South Korean equities, which fell over 4%.

MSCI’s gauge for Asian shares fell 1.2% with losses in Japan and Australia. South Korea briefly halted sell orders for program trading after Kospi 200 futures dropped more than 5%, triggering a so-called sidecar for the first time since April. A gauge of technology shares in the region dropped almost 2%.

As investors sought safety, Treasuries advanced across the curve, with the yield on the 10-year falling two basis points to 4.07%. The yen strengthened to 153.24 against the dollar. Cryptocurrencies recouped some of the losses from the prior session, when Bitcoin briefly slipped below the $1,00,000 mark.The pause in the global stock rally came after the booming outlook for artificial intelligence and hopes the Federal Reserve will keep cutting rates sent the US stock benchmark up by almost 40% from its lows in April. But those gains have been confined to fewer shares as sentiment and technical indicators showed signs of overheating, leading Wall Street chiefs to note the possibility of a retreat as a healthy development.

“The stock market is ripe for some sort of material pullback over the near-term, no matter where it’s going over the intermediate/longer-term,” according to Matt Maley at Miller Tabak.

Elsewhere, the Australian dollar surged to a 12-year high against the Kiwi early Wednesday after a jump in New Zealand’s jobless rate.