TOKYO (Reuters) - Asian shares and bond yields sank on Friday while the dollar, yen, oil and gold surged after reports of a sharp escalation in Middle East hostilities.

MSCI's broadest index of Asia-Pacific shares dived more than 2% and U.S. stock futures also pointed 1.3% lower following media reports Israeli missiles had hit a site in Iran.

U.S. long-term Treasury yields dropped as much as 13.5 basis points to 4.512%. The U.S. dollar index was last up 0.14%, while the yen gained about 0.4% versus the dollar. Both currencies are considered safe havens.

Gold jumped 1.6% to $2,414.69, heading back toward last week's all-time high at $2,431.29.

"Market response looks tied to fears that this is an Israeli reprisal," said Kyle Rodda, an analyst at Capital.com.

"We're just waiting to get more news now as the situation unfolds."

Oil prices jumped $3 a barrel as the reports heightened concerns that Middle East supply could be disrupted.

Israeli Prime Minister Benjamin Netanyahu had vowed retaliation earlier this week following a volley of attacks from Iran on the weekend.

(Reporting by Kevin Buckland. Editing by Sam Holmes.)