The pound is hovering near 20-month lows, as political turmoil deepens in Britain with a key vote on Brexit delayed while US shares have staged a late rebound in a positive signal for Asian markets.

British Prime Minister Theresa May abruptly postponed a parliamentary vote on her Brexit agreement on Tuesday, a move that hit risk assets globally and sent the pound spiralling to $1.2505.

Separately, disappointing data from major economies including China and Japan have fanned worries about global economic activity. The ongoing Sino-US trade battle has also clouded the outlook for world growth.

Read Next All that has put brakes to the rapid momentum in equities, with MSCI's broadest index of Asia-Pacific shares outside Japan skidding more than 16 per cent so far this year. It had surged 33.5 per cent in 2017.

The index was last off 0.1 per cent. Australian shares gained 0.6 per cent while Japan's Nikkei lifted 0.2 per cent.

Overnight on Wall Street, major indexes bounced modestly from an initial drop due in part to a recovery in Apple shares. The Dow added 0.1 per cent, the S&P 500 gained 0.2 per cent and the Nasdaq climbed 0.7 per cent.

But analysts said overall sentiment was still fragile.

"The bear market vibe at the end of 2018 is expected to continue, with asset prices finding their lows in the first half of 2019 once rate expectations peak and global earnings expectations trough," according to BofAML.

For the year ahead, BofAML has forecast modest gains in equities and credit, a weaker dollar, widening credit spreads, and a flattening to inverted yield curve - a combination that calls for heightened volatility.

Sterling cracked below important chart support around $1.26 as May delayed the vote and the European Union refused to renegotiate while MPs doubted her chances of winning big changes.

The dollar climbed on the yen to 113.19. An index that measures the greenback against a basket of major currencies has jumped 5.5 per cent so far this year as investors pile on the dollar as a safe haven bet.

The currency also gained as the US Federal Reserve stayed on its policy tightening path, although uncertainties over how much further the Fed can go have turned dollar bets sour.

Among emerging markets, investors will focus on India where the central bank governor abruptly resigned.

In commodities, oil prices echoed the weakness in global stock markets amid worries about a slowdown in demand.