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TOKYO (Reuters) - Asian shares fell on Wednesday as a rise in U.S. bond yields to 3 percent and warnings from bellwether U.S. companies of higher costs drove fears that corporate earnings growth may peak soon.

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Market prices are reflected in a glass window at the Tokyo Stock Exchange (TSE) in Tokyo, Japan, February 6, 2018. REUTERS/Toru Hanai

MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS dropped 0.7 percent to its lowest in almost three weeks, with tech-heavy Taiwan shares .TWII hitting two-month lows on worries about slowing semi-conductor demand.

Japan's Nikkei .N225 also dropped 0.7 percent.

S&P E-mini futures ESc1 slipped 0.2 percent. Wall Street shares skidded overnight, with the S&P 500 .SPX falling 1.34 percent, the most in two-and-a-half weeks.

Industrial heavyweight Caterpillar (CAT.N) beat earnings estimates due to strong global demand but its shares tumbled 6.2 percent after management said first-quarter earnings would be the “high water mark” for the year and warned of increasing steel prices.

“We’ve seen quite a lot of companies announcing above-estimate earnings and their shares falling sharply,” said Norihiro Fujito, senior investment strategist at Mitsubishi UFJ Morgan Stanley Securities.

Fujito noted major financial shares such as Goldman Sachs (GS.N) and Citigroup (C.N) as well as Google parent Alphabet GOOG.N, the first major tech firm to report earnings, have followed a similar pattern.

Corporate earnings are in solid shape, with analysts estimating 21.1 percent growth in the Jan-March quarter among U.S. S&P500 firms according to Thomson Reuters data. A similar trend is expected globally.

(For a graphic of global corporate earnings click reut.rs/2FeyaIU)

“If shares are falling when corporate earnings are rising 20 percent and the economy is growing

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