Stocks in Asia are set to start May lower after renewed concerns that the Federal Reserve will keep interest rates higher for longer helped fuel a sell-off in US benchmarks and boosted bond yields and the dollar.

Equity futures for Tokyo and Sydney pointed to drops of at least 1%, with many markets in the region closed for public holidays. The S&P 500 fell the most since January after a jump in a broad gauge of US labor costs closely watched by policymakers reinforced bets that officials will keep rates unchanged at a two-decade high on Wednesday — and are unlikely to lower them anytime soon. US stock futures fell in early trading.