(Updates prices throughout, adds Asian shares)
* Asian stock markets : https://tmsnrt.rs/2zpUAr4
* MSCI ex-Japan falls 0.6 pct, Nikkei opens sharply lower
* Japanese yen near six week highs on global growth fears
* Australian 10-year bond yields at record lows
* U.S. recession risk flashing amber - analysts
By Swati Pandey
SYDNEY, March 25 (Reuters) - Investors dumped shares on Monday and fled to the safety of bonds while the Japanese yen hovered near a six-week high as risk assets fell out of favour on growing worries about an impending U.S. recession, sending global yields plunging.
U.S. stocks futures turned negative in early Asian trading with E-minis for the S&P 500 ESc1 skidding 0.5 percent. MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS dropped 0.6 percent to a one-week low. Japan's Nikkei .N225 tumbled 2.9 percent, South Korea's Kospi index .KS11 declined 1.5 percent while Australian shares .AXJO faltered 1.3 percent.
On Friday, all three major U.S. stock indexes registered their biggest one-day percentage losses since Jan.3 with the Dow .DJI sliding 1.8 percent, the S&P 500 .SPX off 1.9 percent and the Nasdaq .IXIC dropping 2.5 percent.
Concerns about the health of the world economy heightened last week after cautious remarks by the U.S. Federal Reserve sent 10-year treasury yields to the lowest since early 2018.
Adding to the fears of a more widespread global downturn, manufacturing output data from Germany showed a contraction for the third straight month. And in the United States, preliminary measures of manufacturing and services activity for March showed both sectors grew at a slower pace than in February, according to data from IHS Markit. response, 10-year treasury yields slipped below the three-month rate for the first time since 2007. Historically, an inverted yield curve - where long-term rates fall below short-term - has signalled an upcoming recession.
"We have re-run our preferred yield curve recession models, which now suggest a 30-35 percent chance of a U.S. recession occurring over the next 10-18 months," said Tapas Strickland, markets strategist at National Australia Bank.
Typically a 40-60 percent probability sees a recession within the next 10-18 months, Strickland added, basing the analysis on previous recessions.
"The risk of a U.S. recession has risen and is flashing amber and this will keep markets pricing a high chance of the Fed cutting rates."
As bonds rallied on Monday, yields on 10-year Japanese government bonds JP10YT=RR slumped to minus 8 basis points, the weakest since September 2016. Australian 10-year year yields AU10YT=RR plunged to a record low of 1.756.
POLITICAL HEADWINDS
Much of the concerns around global growth is stemming from Europe and China which are battling separate tariff wars with the United States.
Politics was also in focus in the United States and Britain.
A nearly two-year U.S. investigation found no evidence of collusion between Donald Trump's election team and Russia, in a major political victory for the U.S. President. long-awaited Mueller report into whether Trump's campaign colluded with Russia to help Trump defeat his Democratic opponent, Hillary Clinton, marked a major milestone of his presidency as he prepares for his 2020 re-election battle.
Political turmoil in Britain over the country's exit from the European Union also remains a drag on risk assets.
On Sunday, Rupert Murdoch's Sun newspaper said in a front page editorial British Prime Minister Theresa May must announce on Monday she will stand down as soon as her Brexit deal is approved. British pound GBP=D3 was a shade lower at $1.3189 after three straight days of wild gyrations. The currency slipped 0.7 percent last week.
In currency markets, the Japanese yen - a perceived safe haven - held near its highest since Feb. 11. It was last flat at 109.95 per dollar. JPY=
The Australian dollar AUD=D3 , a liquid proxy for risk play, was down for its third straight session of losses at $0.7073.
In commodities, U.S. crude CLcv1 fell 33 cents to $58.71 per barrel. Brent crude futures LCOc1 eased 24 cents to $66.79.
<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ Asia stock markets
https://tmsnrt.rs/2zpUAr4 Asia-Pacific valuations
https://tmsnrt.rs/2Dr2BQA
^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^> (Editing by Shri Navaratnam)