HONG KONG – Asian shares dropped and the safe-haven dollar held firm on Tuesday, as a global energy crunch fuelled inflation fears, clouding investor sentiment before the US corporate earnings season.

MSCI’s broadest index of Asia-Pacific shares outside Japan was down 0.9 percent in early trade, after US stocks ended the previous session with mild losses. US stock futures, the S&P 500 e-minis, fell 0.43 percent.

Australian shares slipped 0.29 percent while Japan’s Nikkei stock index slid 1.03 percent.

“Risk markets had a mixed start to the week amid light data flow and ahead of the US earnings season,” ANZ analysts said in a note.

“Economies appear to be entering a more challenging phase of the cycle and we think investors and corporates will be monitoring how the economic data and earnings results fall before making assessments of near term direction.”

Wall Street’s main indexes ended a choppy session lower on Monday as investors grew nervous ahead of third-quarter earnings reporting season.

A rally in basic material and energy shares on higher oil prices initially lifted major US stock indices. But the gains faded amid concerns about earnings, set to kick off with JPMorgan Chase & Co results on Wednesday.

Some analysts expect companies to report slowing growth due to supply-chain snags and rising prices. They warned that this could lead to a drop in US stocks.

JPMorgan shares were down 2.1 percent and among the biggest drags on the S&P 500, which lost 0.69 percent to 4,361.19.

The Dow Jones Industrial Average fell 0.72 percent to 34,496.06, while the Nasdaq Composite dropped 0.64 percent to 14,486.20.

After US data last week showed weaker jobs growth than expected in September, the focus now shifts to inflation and retail sales numbers this week. Investors also expect the Federal Reserve to begin tightening policy by announcing a tapering of its massive bond-buying next month.

The prospect of accelerating inflation and tighter monetary policy lifted bond yields.

The yield on benchmark 10-year yield touched 1.6136 percent after a strong rise on Monday. The two-year yield rose to 0.3517 percent, up from its US close of 0.318 percent.

The dollar index, which tracks the greenback against a basket of currencies of other major trading partners, was up at 94.423.