MSCI's index of Asia-Pacific stocks outside Japan fell 0.6 percent. Japan's Nikkei fell 0.88 percent while Hang Seng index was down 0.42 percent and Chinese blue chips fell 0.7 percent.
Asian stocks slipped and the dollar stood by a two-decade high on the euro on Wednesday as investors' fears deepened that the continent is leading the world into recession, while oil and European equity futures attempted to steady after a slide.
Brent crude futures bounced 1.4 percent in morning trade to $104.18 a barrel, nursing its wounds after a 9.5 percent drop to a 2-1/2 month low on Tuesday with worries that a global growth slowdown is going to sap demand.
MSCI's index of Asia-Pacific stocks outside Japan fell 0.6 percent. Japan's Nikkei fell 0.88 percent, on course for its first loss of the week. S&P 500 futures fell 0.2 percent, though Euro STOXX 50 futures bounced 1.8 percent.
Hong Kong's Hang Seng index was down 0.42 percent while Chinese blue chips fell 0.7 percent, dragged by worries about new COVID-19 cases in Shanghai risking fresh restrictions.
Overnight Europe's STOXX 600 index dropped 2 percent and the euro plunged more than 1.5 percent to $1.02, its lowest since late 2002 as talk of gas rationing spooked traders.
"The drumbeat is getting louder and louder about recession risk," said Jason Teh, chief investment officer at Vertium Asset Management in Sydney. "Right now defence is the name of the game. It's the best strategy right now, because in a recession a lot of things can fall out of bed."
Uncertainty over Europe's gas supply has set prices rocketing. Benchmark Dutch gas prices have doubled since the middle of June and rose 7 percent overnight to a four-month high.
Year-ahead baseload power in Germany hit a record high. Investors are nervous about continuity of supply after the Nord Stream pipeline, which carries Russian gas to Germany, shuts for ten days for maintenance from July 11.
In Tokyo, shares of commodities trading firms Mitsui & Co and Mitsubishi Corp dropped more than 5 percent after former Russian president Dmitry Medvedev threatened oil and gas supply cuts to Japan.
Sterling was also pinned by a two-year low and not helped by the latest political crisis to hit Prime Minister Boris Johnson's government, with the resignation of his finance and health secretaries questioning his longevity as leader. After touching $1.18 overnight the currency steadied at $1.19 in Asia.
A change in leader, or speculation about it, could lend support but it is weighed heavily by an economic outlook that a new leader is unlikely to shift.
"The UK is in danger of being the slowest-growing major advanced economy next year, with the highest inflation rate and the biggest current account deficit," said Societe Generale strategist Kit Juckes. "That's quite a collection, and it represents a clear threat to the pound."
Elsewhere the dollar also stood tall, holding the risk-sensitive Antipodean currencies near two-year lows and dunking spot gold prices to their lowest this year. The Aussie was last huddled at $0.68 having slid 1 percent overnight to a two-year trough of $0.67.
Spot gold was last steady at $1,771 an ounce after its overnight fall. Safe-haven gold is down about 3 percent this year, less than the steep losses for equities and bonds.
Investors now await the release of US payroll data on Friday for further signs of whether the economy may fall into a recession.
"A strong payrolls figure may temper recession fears briefly, though it will also likely drive up two-year yields and probably won't be regarded as unambiguously positive by the equity investment community," ING's Robert Carnell and Iris Pang wrote in a note this morning.
Benchmark US treasury yields were flat on Wednesday, with the 10-year note at 2.82 percent. Bitcoin fell back below the key $20,000 waterline, falling 2.77 percent to trade at $19,855.14.