Asian shares mixed after global bond sell-off deepens and ahead of US jobs data

Asian shares showed a mixed performance Friday amid a global bond sell-off and the imminent release of a key U.S. jobs data. The Nikkei 225 in Japan declined by 0.9% to 68,326.72, while South Korea's Kospi gained 0.2% to 6,984.96. Hong Kong's Hang Seng fell by 2.7% to 23,956.32, marking the lowest level since July. Australia's S&P/ASX 200 increased by 0.4% to 8,651.30, and Taiwan's Taiex rose by 0.2%.

Mainland China's markets were closed for a holiday. U.S. futures edged up after Treasury yields remained stable early in the trading session. The yield on the 10-year U.S. Treasury bond was around 5.25%, down from 5.34% on Thursday, the highest since 2002. The yield crossed the 5% mark last month, as global inflation, driven by the Iran war and increasing U.S. government debt, pushed investors to seek higher returns.

The 5% level on the U.S. 10-year Treasury yield has been a significant psychological threshold for investors. An important likelihood exists that the U.S. 10-year Treasury yield could rise to 5.5% to 6%, according to David Clewell, a portfolio manager at T. Rowe Price. Higher bond yields can negatively impact stock markets, as higher borrowing costs can diminish stock returns.

U.S. stock indexes ended mostly flat on Friday, with the S&P 500 up 0.2%, the Dow Jones Industrial Average rising less than 0.1%, and the Nasdaq composite increasing slightly less than 0.1%. Investors and traders are closely watching the upcoming U.S. monthly jobs report for September, which could shed light on the possibility of an October interest rate hike by the Federal Reserve, following the recent rate increase in September.

Oil prices experienced a slight decline early on Friday as tensions in the Middle East persisted, and the U.S. contemplated potential escalations against Iran. The tension escalated after President Trump threatened to "blow them up" or negotiate with Iran, referring to Iran in an exchange with reporters. The price of Brent crude, the international benchmark, dropped by 0.2% to $102.13 per barrel, rebounding from around $72 per barrel in late February before the conflict began.

The U.S. dollar slipped to 157.91 Japanese yen from 158.09 yen, while the euro traded at $1.1250, up from $1.1244.