Asian shares barely moved on Wednesday after world stocks hit eight-week lows the previous day on worries about global economic growth, although the British pound stayed firm on hopes for a Brexit deal.
MSCI's broadest index of Asia-Pacific shares outside Japan was flat, while Japan's Nikkei average fell 0.4 per cent and the Australian benchmark was up just 0.1 percent.
In China, mainland's benchmark Shanghai Composite shed 0.2 per cent in choppy trade and Hong Kong's Hang Seng added 0.3 per cent.
"As uncertainty continues to prevail in financial markets across the world, many investors are staying on the sidelines until more clarity emerges in U.S. Treasury and Chinese markets," said Yasuo Sakuma, chief investment officer at Libra Investments.
Benchmark U.S. 10-year Treasury yields touched a 7-1/2-year peak of 3.261 per cent and those on 30-year bonds hit their highest in more than four years, but later fell back.
Some traders say comments on Tuesday by U.S. President Donald Trump helped cool Treasuries yields. He said the Federal Reserve was going too fast in raising rates when inflation was minimal and government data pointed to a strong economy.
Italian government bond yields also fell from multi-year highs after Economy Minister Giovanni Tria pledged to do whatever is necessary to restore calm if market turbulence turns into a financial crisis.
On stock markets, Wall Street showed a mixed picture, with the Dow Jones Industrial Average falling 0.21 per cent while the S&P 500 and the Nasdaq Composite were little changed.
The MSCI All-Country World index, which tracks shares in 47 countries, hit the lowest level since August 16 overnight. It last traded up 0.1 percent on the day.
The International Monetary Fund cut global economic growth forecasts for 2018 and 2019, as well as its U.S. and China estimates for next year, saying the two countries would feel the brunt of the impact of their trade war next year.
The dollar dipped due to a fall in U.S. bond yields after touching a seven-week peak against a basket of currencies. The dollar index last traded flat at 95.586.
Sterling continued to gain after a report that rekindled hopes that Britain and the European Union are on the brink of a Brexit deal. It last traded up 0.1 percent at $1.3158.
"We can't be too optimistic about the Brexit process, because even if a deal can be struck at an anticipated special EU summit in November, it has to get through the British Parliament," said Kengo Suzuki, chief FX strategist at Mizuho Securities.
The offshore yuan rose 0.1 per cent to 6.9236 after falling earlier this week to as low as 6.9371 to the dollar, its weakest since mid-August.
Oil prices edged lower on Wednesday after the IMF lowered its global growth forecasts but prices were somewhat supported as Hurricane Michael churned towards Florida, causing the shutdown of nearly 40 per cent of U.S. Gulf of Mexico crude output.
U.S. crude oil futures dropped 0.5 per cent to $74.61 a barrel and Brent crude futures eased 0.2 per cent to $84.80 a barrel.
Gold prices stood flat as investors remained cautious after U.S. Treasury yields hit then retreated from multi-year highs.
(With inputs from agencies.)