BEIJING - Asian shares fell on Thursday, while the sell-off in US Treasuries paused and oil prices rose, as investors and traders weighed the latest developments in the conflict in Ukraine and more hawkish comments from US Federal Reserve officials.

MSCI's broadest index of Asia-Pacific shares outside Japan dropped 0.6 percent. Japan's Nikkei fell by more than 1 percent on Thursday morning, after touching a two-month high in the previous session.

Hong Kong's Hang Seng Index was down 0.9 percent. Shares of Tencent Holdings dropped 4.6 percent after it posted its slowest-ever sales rise.

US President Joe Biden arrived in Brussels for a series of summit meetings on the conflict Ukraine, with Biden set to announce a US package of Russia-related sanctions on political figures and oligarchs on Thursday.

Brent futures were up about 45 cents, or 0.4 percent, at $122.05 a barrel and US West Texas Intermediate futures were up about 15 cents, or 0.2 percent, at $115.07 a barrel.

The bond market, meanwhile, paused for breath with the yield on benchmark 10-year Treasury notes last at 2.3098 percent in Tokyo trading, after retreating from a nearly three-year peak of 2.4170 percent overnight.

The two-year yield , which is more sensitive to traders' expectations for the Fed funds rate, stood at 2.1233 percent, down from an almost three-year high of 2.2020 percent reached Tuesday.

Federal Reserve policymakers on Wednesday signaled they stand ready to take more aggressive action to bring down unacceptably high inflation, including a possible half-percentage-point interest rate hike at the next policy meeting in May. 

Major US equities indexes declined more than 1 percent on Wednesday. The Dow Jones Industrial Average fell 448.96 points, or 1.3 percent, to 34,358.5; the S&P 500 slid 55.41 points, or 1.2 percent, to 4,456.2; and the Nasdaq Composite dropped 186.21 points, or 1.3 percent, to 13,922.60.

"Equities reversed part of their recent rally as bond yields declined, in a move that might be just a simple pull-back after a ripping rally over the past 10 days," said Kyle Rodda, market analyst at IG.

"It is still though a relatively volatile market, (which) suggests that these ripping moves in stocks ought to be treated with caution."

Currency markets steadied on Thursday with the Japanese yen nursing heavy losses. It had hit a six-year low of 121.41 on Wednesday as rising US yields and a deteriorating trade balance sucked cash out of Japan.

The euro hovered at $1.0988 and the Australian dollar took a breather after several days of large gains. The Aussie was little changed at $0.74955, sticking close to an almost five-month high of $0.75070 touched on Wednesday.

Gold was slightly lower, trading at $1942.9 per ounce.