Asian shares wobbled while commodity prices fell on Thursday as mounting worries about the risks of a global recession amid aggressive rate hikes by the Federal Reserve kept broad investor sentiment fragile.

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MSCI's broadest index of Asia-Pacific shares outside Japan reversed earlier gains to be mostly flat in Asia trade. Stocks in South Korea were off, while Japan's Nikkei was broadly unchanged.

Hong Kong's Hang Seng Index climbed 0.6 percent, following the news that Chinese President Xi Jinping chaired a top-level meeting on Wednesday that approved a plan for the healthy development of China's large payment firms and fintech sector.

Overnight, the dollar fell alongside US Treasury yields after Fed Chair Jerome Powell, in testimony to the US Senate Banking Committee, acknowledged a recession was "certainly a possibility", but the Fed is not trying to engineer one.

Also read: Hang Seng, Nikkei Falls As Wall Street Optimism Peters Out

A Reuters poll showed the Fed will deliver another 75-basis-point interest rate hike in July, followed by a half-percentage-point rise in September, and won't scale back to quarter-percentage-point moves until November at the earliest.

"What is clear is the market views a recession as increasingly likely, a view heard from Powell, who detailed that a recession was a possibility but not their intention," said Chris Weston, head of research at brokerage Pepperstone in Melbourne.

"Equities have held in well despite the falls in commodities, altogether there has been rotation into low-risk areas of the market and defensive sectors, with predictable outflows from energy and materials stock."

US stocks reversed earlier gains and ended the session slightly down. The Dow Jones Industrial Average fell 0.15 percent, the S&P 500 lost 0.13 percent, and the Nasdaq Composite dropped 0.15 percent.

Also read: Nikkei Edges Up With Wall Street Futures

Investors are continuing to assess the risks of central banks pushing the world economy into recession as they attempt to curb inflation with interest rate increases.

Concerns about the demand outlook have sapped commodity prices, with oil on Thursday falling to the lowest level in more than a month. Brent crude was down 2 percent to $109.49 per barrel and US crude declined 2.3 percent to $103.75 a barrel.

The yield on benchmark 10-year Treasury notes was down slightly in early trade to 3.14 percent, the lowest in almost two weeks, compared with its US close of 3.15 percent the previous day. The two-year yield, which rises with traders' expectations of higher Fed fund rates, touched 3.03 percent compared with a US close of 3.05 percent.

In the foreign exchange markets, the dollar eased 0.1 percent against a basket of major currencies, following a 0.2 percent fall the previous session. However, the index was up more than 8 percent this year, reflecting the broad risk-off sentiment and the dollar's Fed-driven yield advantage.

Those factors were underscored by the South Korean won, which fell below a psychological threshold of 1,300 per dollar for the first time in 13 years, amid global economic recession worries. Gold was slightly lower, with spot prices traded at $1835.19 per ounce.