* Asian stock markets: https://tmsnrt.rs/2zpUAr4
* Investors hope for resolution to U.S.-China trade dispute
* Markets already buoyed by Brexit, HK
* Safe havens fall after China confirms talks
* Oil swings between gains and losses in Asia
By Stanley White
TOKYO, Sept 5 (Reuters) - Asian shares extended gains on
Thursday and U.S. stock futures jumped after China said it will
hold trade talks with the United States in early October,
raising hopes they can de-escalate their trade war before it
inflicts further damage on the global economy.
MSCI's broadest index of Asia-Pacific shares outside Japan
.MIAPJ0000PUS was up 1.08% at its highest since Aug. 2, while
the Shanghai composite index .SSEC surged 1.7%. Japan's Nikkei
.N225 added 2.4%.
U.S. stock futures ESc1 reversed early losses and rose 1%.
Pan-European Euro Stoxx 50 futures STXEc1 were up 1.01%,
with Germany's DAX futures FDXc1 up 1.04% and FTSE futures
FFIc1 up 0.64%.
The Chinese yuan jumped versus the dollar in offshore trade,
while safe-have assets such as gold, the Swiss franc, and the
yen fell.
China's confirmation of trade talks added to upbeat
geopolitical news overnight. A parliamentary vote in Britain put
the brakes on the nation's no-deal exit from the European Union,
Hong Kong withdrew a contentious extradition bill that sparked
recent protests and political turmoil in Italy appeared to be
easing.
China's Commerce Ministry said its trade team will consult
with their U.S. counterparts in mid-September in preparation for
negotiations in early October, hinting at progress in reducing
trade friction. Both sides had agreed to take actual actions to create
favourable conditions, the ministry added, without giving more
details.
"Since yesterday, there has been limited downside in markets
because of what happened in Hong Kong, but now the U.S.-China
talks are the story," said Masayuki Kichikawa, chief macro
strategist at Sumitomo Mitsui Asset Management Co in Tokyo.
"It's the same about Brexit, which means less downside
risk."
Any sign that Washington and Beijing are closer to scaling
back or resolving their trade dispute would lift a significant
burden from the global economy, but many analysts believe the
two sides are dug in for a longier and costlier battle.
Hong Kong .HSI shares erased early losses to rise 0.3%.
They had jumped in afternoon trade on Wednesday after leader
Carrie Lam said she was withdrawing an extradition bill that had
triggered months of often violent protests in the Asian
financial hub. Lam said on Thursday she hopes the formal withdrawal of a
controversial extradition bill and other measures will help
solve the city's political crisis. In currency markets, sterling held onto gains against the
dollar in Asia after rallying the most in more than five months
on Wednesday after lawmakers voted to prevent Prime Minister
Boris Johnson taking Britain out of the European Union without a
deal on Oct. 31. But, more than three years since the United Kingdom voted
narrowly to leave the EU, the outcome of Brexit is still
unclear, with possible outcomes ranging from a crash out of the
EU to abandoning the whole endeavour.
Against the offshore yuan CNH=D3 , the dollar fell 0.2% to
7.1340 yuan.
Spot gold XAU= fell 0.5% to $1545.58 per ounce. GOL/
The dollar rose 0.17% to 106.60 yen JPY=EBS gained 0.3% to
0.9839 Swiss franc CHF=EBS .
U.S. Treasury yields extended gains in Asia and the yield
curve steepened, both signs that investors were willing to take
on riskier assets.
The 10-year yield US10YT=RR rose to 1.5145%, while
two-year yields US2YT=RR rose to 1.4899%.
The spread between two- and 10-year Treasury yields
US2US10=TWEB , the most commonly used measure of the yield
curve, approached the highest since Aug. 21.
The curve inverted on Aug. 14 for the first time since 2007
when long-term yields traded below short-term yields, which is a
widely accepted indicator of coming recession.
U.S. West Texas Intermediate crude CLc1 was little changed
at $56.27 per barrel.
Crude futures surged 4.3% on Wednesday, the biggest daily
gain since July 10, due to positive economic data from China and
easing geopolitical concerns.
Trade Balance Image https://tmsnrt.rs/2FQ3e4N
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(Editing by Sam Holmes & Kim Coghill)