SINGAPORE - Asian stocks rose on Tuesday while US Treasury yields steadied, allowing a bit of a breathing room for the US dollar as investors took stock of the debt load of the world's biggest economy and awaited trade deals.

Moody's downgrade of its rating for US sovereign credit last week - due to concerns about that nation's growing $36 trillion debt pile - led to a selloff in Treasuries on Monday but that stabilized by Asian trading hours on Tuesday.

"The Moody's downgrade was a temporary shock and rather meaningless in the bigger picture," said Kyle Rodda, senior financial market analyst at Capital.com.

"But then we're not really being fed any kind of fresh new news for investors to buy into... We haven't gotten any new deals coming through."

With little indication of trade deals on the way, markets are struggling for direction, analysts said.

The 30-year bond yield was 3.5 basis points lower at 4.906 percent after hitting an 18-month high of 5.037 percent in the previous trading session. Major US stock indexes recovered from early loss to end mostly flat.

That left the MSCI's broadest index of Asia-Pacific shares outside Japan 0.36 percent higher, hovering near the seven-month high touched last week. Japan's Nikkei gained 0.65 percent in early trade.

US Federal Reserve officials took on cautiously the ramifications of the Moody's downgrade and unsettled market conditions as they continued to navigate an uncertain economic environment in the wake of erratic US trade action.

While not an imminent issue for the Fed, higher borrowing costs tied to a deteriorating US financial position could make credit generally more expensive and create restraint on economic activity.

Traders have priced in two interest rate cuts from the US central bank this year, versus four last month when US President Donald Trump's tariff salvos upended markets and led to investors exiting US assets.

"For now, US exceptionalism and corporate resilience are offsetting the risks," said Charu Chanana, chief investment strategist at Saxo in Singapore.

"But how long before investors start demanding a higher risk premium, especially with the Fed in wait-and-see mode and trade talks seemingly stalling?"

Markets will be monitoring a US congressional debate over a tax bill later in the day at which Trump is widely expected to be present ahead of a vote on the legislation later this week.

The measure would extend Trump's 2017 tax cuts and potentially add $3 trillion to $5 trillion to the national debt over the next decade.

Investors will also watch out for a policy decision from the Reserve Bank of Australia, with cuts to interest rates widely expected. The Australian dollar was a tad weaker at $0.64485.

In commodities, oil prices were mixed as investors contended with a potential breakdown in talks between the US and Iran over the latter's nuclear activity and weakened prospects of more Iranian supply entering the market.