Global markets-Stocks fall, bond rout deepens as US and Iran trade attacks

"The recent increase in energy prices has put additional upward pressure on bond yields, which had already been on the rise on the back of some fiscal concerns," said Kiran Ganesh, multi-asset strategist at UBS Global Wealth Management.

The yield on the benchmark U.S. 10-year Treasury bond rose to an intraday high of 4.8122%, its highest level in almost three years, while the yield on the 10-year Japanese government bond held above 3% for a second straight session after hitting a three-decade high earlier this week.

Rising yields tend to support the U.S. dollar by boosting its appeal as a safe-haven asset, while reducing demand for equities and other riskier investments.

The U.S. dollar index, which measures the greenback against a basket of six currencies, was up 0.05% at 99.734, near its highest since August 17.