Asian markets mixed; Japan, South Korea fall on bond concerns

Asian stock markets closed mixed on Monday, October 26, 2026, with Japanese and South Korean shares falling sharply while Hong Kong, mainland China, and Australia posted gains, amid concerns over rising bond yields, high inflation, and currency market volatility. Japan's Nikkei fell 0.80% to 62,189.65, pressured by higher government bond yields impacting financial institutions' capital bases. South Korea's KOSPI dropped 1.46% to 5,469.47. In contrast, Hong Kong's Hang Seng rose 0.51% to 23,211.81, Shanghai Composite gained 0.19% to 3,697.52, and Australia's S&P/ASX 200 added 0.17% to 8,809.90. Investors are watching third-quarter earnings from major banks, with HSBC reporting Tuesday and Standard Chartered Wednesday. Indonesia's Jakarta Composite fell 1% and the rupiah weakened 0.39% to 18,110 per dollar, following MSCI's warning that the country could be downgraded to standalone market status over trading transparency concerns.