BANGKOK (AP) — Asian markets were sharply lower on Wednesday after Wall Street tumbled as it focused on the downside of a surprisingly strong job market: the likelihood that interest rates will stay high.

U.S. futures and oil prices edged lower.

Tokyo’s Nikkei 225 index sank 2.2% to 30,551.85 and the Kospi in South Korea dropped 2.3% to 2,408.68.

Hong Kong’s Hang Seng skidded 1% to 17,151.61. Troubled property developer China Evergrande was down 8.5% after plunging 28% on Tuesday.

Australia’s S&P/ASX 200 shed 1% to 6,873.90. In Bangkok, the SET fell 0.2%.

On Tuesday, the S&P 500 lost 1.4% to 4,229.45. The Dow sank 1.3% to 33,002.38, wiping out the last of its gains for the year so far. The Nasdaq composite led the market lower with a 1.9% drop to 13,059.47 as Big Tech stocks were among the market’s biggest losers.

Amazon fell 3.7%, Microsoft dropped 2.6% and Nvidia lost 2.8%.

The Dow is down 0.4% for the year so far, after being up nearly 8% at the start of August. The S&P 500, which is the index more 401(k) investments are benchmarked against, has sliced its gain for the year so far to 10.2%.

Stocks fell after a report showed U.S. employers have many more job openings than expected. Expectations that interest rates will stay high are pressuring stocks as Treasury yields rise in the bond market.

Such weight has been the main reason the S&P 500 has lost more than 40% of its value since the end of July, after charging higher for much of the year.

The 10-year Treasury yield climbed Tuesday to 4.79% from 4.69% late Monday and from just 0.50% early in the pandemic. It touched its highest level since 2007.

When bonds are paying so much more in interest, they pull investment dollars away from stocks and other investments prone to bigger price swings than bonds. High yields also make borrowing more expensive for companies and households across the economy, which can hurt corporate profits.

Investors increasingly are taking the Federal Reserve at its word that it will keep its main interest rate high for a long time in order to drive down inflation. The Fed has already yanked its federal funds rate to the highest level since 2001, and it indicated last month it may keep the rate higher in 2024 than it earlier expected.

Fed Gov. Michelle Bowman said in a speech Monday that she expects it will likely be appropriate “to raise rates further and hold them at a restrictive level for some time.”

Tuesday’s report showed employers were advertising 9.6 million job openings in late August, much higher than the 8.9 million economists expected. That could keep upward pressure on wages to attract employees.

Several other challenges are also tugging at Wall Street besides higher yields. The resumption of student-loan repayments could drag on spending by U.S. households, which has been strong enough to help keep the economy out of a recession despite high interest rates. Higher oil prices are threatening to worsen inflation, and economies around the world look shaky.

Oil prices ticked higher a day after slumping sharply to trim their big gains since the summer.

A barrel of benchmark U.S. crude lost 8 cents to $89.15 per barrel in electronic trading on the New York Mercantile Exchange. It rose 41 cents to settle at $89.23 on Tuesday. Brent crude, the international standard, gave up 9 cents to $90.83 per barrel.

The dollar rose to 149.26 Japanese yen from 149.04 yen. The yen’s weakness against the dollar has drawn protests from Japanese officials, and analysts said they believed regulators had intervened Tuesday to prevent the dollar from surpassing the 150 yen level.

The euro fell to $1.0462 from $1.0468.


AP Business Writer Stan Choe contributed.