GLOBAL MARKETS-Asian stocks set for cautious start amid renewed U.S.-China tensions

By Lawrence Delevingne
BOSTON, Aug 10 (Reuters) - Asian stocks were set for a
cautious start on Tuesday, following a mixed Wall Street session
and as investors eyed stalled U.S. stimulus efforts and
worsening strains between Washington and Beijing over Hong Kong.
Australian S&P/ASX 200 futures YAPcm1 fell 0.05% in early
trading.
Japan's Nikkei 225 futures NKc1 slipped 0.04%. Tokyo
markets were closed for a public holiday on Monday.
Hong Kong's Hang Seng index futures .HSI HSIc1 rose
0.43%.
"The very subdued start to the week in all time zones Monday
looks like persisting in Asia today," Ray Attrill, Head of FX
Strategy at National Australia Bank, told Reuters via email.
Attrill noted little progress on the next round of U.S.
fiscal stimulus, more tit-for-tat posturing between China and
the U.S., and a light calendar for Asian financial markets.
Asked on Monday if he would respond to new Chinese sanctions
on 11 U.S. citizens, including Republican lawmakers, President
Donald Trump said he had already responded with sanctions on
Hong Kong and Chinese officials last week. However, Trump also added that the Phase 1 trade deal with
China means "very little," which could set the stage for further
tension when officials from both countries meet on Saturday to
review progress over the first six months of the agreement.
U.S. stocks were mixed on Monday. The Dow jumped 1%, the S&P
500 inched up and the Nasdaq closed lower as investors extended
a rotation into value stocks from heavyweight technology-related
names. U.S. congressional leaders and Trump administration
officials said on Monday they were ready to resume negotiations
on a coronavirus aid deal but talks remained deadlocked as
Democrats said Republicans needed to meet them in the middle.
Also on Monday, China imposed sanctions on 11 U.S. citizens
including lawmakers from Trump's Republican Party in response to
Washington's imposition of sanctions on Hong Kong and Chinese
officials accused of curtailing political freedoms there.
The dollar gained, but analysts said this move was likely
unsustainable.
"U.S.-China tensions continue to simmer, and are providing
support to the dollar," strategists at Commonwealth Bank of
Australia wrote in a note on Tuesday. "But we doubt U.S.-China
tensions can derail the well-established dollar downtrend."
The dollar index =USD rose 0.18%, with the euro EUR= up
0.03% to $1.174.
The Japanese yen strengthened 0.01% versus the greenback at
105.95 per dollar.
The Australian dollar was flat versus the greenback at
$0.715.
The Korean won weakened 0.01% versus the greenback at
1,185.73 per dollar.
Oil rose, supported by the Chinese producer price data,
rising energy demand and hopes for an agreement in the United
States on more coronavirus-related economic stimulus. O/R
U.S. crude CLc1 were up 0.12% to $41.99 per barrel and
Brent LCOc1 was flat on the day.

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(Editing by Sam Holmes)