Oil prices rose for a third straight session after President Donald Trump said the interim agreement with Iran to end the war was "over". US military also launched fresh strikes on Iran for a second day to open the Strait of Hormuz, although Trump later said he did not expect a return to a full-fledged war, helping soothe concerns.

Brent crude futures rose 0.8 percent to $78.65 a barrel and were up 9 percent this week to cross above $80 a barrel for the first time since June 22. That knocked global bond markets and boosted bets that the Federal Reserve will have to raise interest rates this year to tame inflation, with Fed funds futures now implying 38 basis points of policy tightening this year, back to where they were a week ago.

Wall Street initially fell on Trump's comments but climbed off session lows, with the Nasdaq eking out a small gain of 0.2 percent. Chip giant Nvidia rallied 3.6 percent after media reports that China plans to allow its top AI firms to buy a limited number of the company's H200 chips.

MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.8 percent, while Japan’s Nikkei climbed 2.3 percent to break a three-day losing streak.

South Korea’s KOSPI jumped 3.8 percent, driven by a 3.6 percent rise in Samsung and a 7.5 percent surge in SK Hynix as investors bought into the recent sell-off in chipmakers.

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Wall Street futures were flat in Asia, while Europe's pan-region stock futures rallied 0.9 percent.

"At this stage, the market still appears skewed towards the view that the [Iran] conflict ultimately de-escalates, and negotiations resume around the Memorandum of Understanding," said Chris Weston, head of research at Pepperstone.

"Nevertheless, traders understand the need to remain open-minded. The situation remains highly fluid, and conviction around timing is exceptionally difficult."

Minutes released by the Fed showed concern about mounting inflation among policymakers as a few participants said there was already a case to raise borrowing costs, before ultimately agreeing with their colleagues to hold rates steady last month.

The global bond rout deepened in Asia. The yield on 10-year Japanese government bonds rose 1.5 basis points (bps) to 2.880 percent, the highest since September 1996, while Australia's 10-year government bond yields increased 4 bps to 4.924 percent, the highest since early June.

The benchmark 10-year US Treasury yields climbed another 2 basis points to 4.5852 percent on Thursday after rising 4 bps overnight. They were up 10 bps so far this week.

The reaction in the currency markets was rather muted, with the dollar failing to hold on to its yield support and last down 0.2 percent to 162.38 yen. That was not far from 40-year peaks of 162.84 as speculators remain wary of Japanese intervention.

The euro edged up 0.1 percent to $1.1428, while sterling also rose 0.1 percent to $1.3401, just below a three-week peak of $1.341.

Gold was flat at $4,079 an ounce.

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