Global markets-Shares, bonds rally as markets await signals for Fed rates

MSCI's broadest index of Asia-Pacific shares outside Japan advanced 0.5%, after U.S. stocks ended the previous session with mild gains.

The dollar index fell 0.05% to 99.54. The euro edged up 0.02% to $1.1589, while the yen strengthened 0.07% to 158.59 per dollar, following a 0.9% surge in the prior session.

U.S. Treasury yields eased from multi-year highs overnight. The rise in borrowing costs across major economies had deepened concerns about tighter monetary policy and deteriorating fiscal conditions.

The yield on benchmark U.S. 10-year notes fell 0.99 basis point to 4.784%. The yield on the 30-year JGB sank 10 bps to 4.065%, down from a near record high before Japan's Ministry of Finance auctions the securities later in the day.

Investors remained on edge over developments in the Middle East after the U.S. and Iran exchanged their largest barrage of attacks since July, reviving fears of a broader regional escalation.