Asian shares skid after S&P 500 logs 1st monthly drop of '21

Asian markets tumbled Friday on the tail of Wall Street’s worst monthly loss since the beginning of the pandemic.

Tokyo skidded 2.3% and Australia’s benchmark sank 2.2%. Markets in Shanghai and Hong Kong were closed for holidays.

The S&P 500 ended September down 4.8%, its first monthly drop since January and the biggest since March 2020.

After climbing steadily for much of the year, the stock market has become unsettled in recent weeks with the spread of the more contagious delta variant of COVID-19, surging long-term bond yields and word that the Federal Reserve may start to unwind its support for the economy.

Japan lifted a pandemic state of emergency on Friday after seeing coronavirus caseloads decline as vaccinations picked up pace. A quarterly survey by the Bank of Japan found business sentiment among Japanese manufacturers has risen to its highest level in nearly three years.

The results of the “tankan” survey, released Friday, found sentiment among large manufacturers rose to 18 from 14. That’s the highest level since late 2018. The reading for nonmanufacturers edged up only slightly, to 2 from 1.

However, it and various other surveys have found manufacturers struggling with shortages of computer chips and other components, amid disruptions to supply chains and shipping that might crimp the recovery from the pandemic.

Tokyo's Nikkei 225 lost 681.59 points to 28,771.07, while the S&P/ASX 200 declined 2.2% to 7,170.50. The Kospi in Seoul lost 1.6% to 3,018.58. Shares also fell in Taiwan and Southeast Asia.

The S&P 500 lost 1.2% on Thursday, ending the month 4.8% lower in its first monthly drop since January and the biggest since March 2020, when the viral outbreak rattled markets as it wreaked havoc with the global economy.

The benchmark index is...