GLOBAL MARKETS-Asian shares steady after steep losses; Saudi comments lift oil

* MSCI Asia ex-Japan +0.6%
* Australian shares surge on surprise election result
* Oil up more than 1% after Saudi minister comments
* Asian stock markets: https://tmsnrt.rs/2zpUAr4

By Andrew Galbraith
SHANGHAI, May 20 (Reuters) - Share markets in Asia got off
to a steady start on Monday as investors tried to catch their
breath following another week of escalating trade tensions
between the United States and China.
In early trade, MSCI's broadest index of Asia-Pacific shares
outside Japan .MIAPJ0000PUS tacked on 0.6% after a steep 3%
loss the previous week. U.S. S&P 500 e-mini futures ESc1 also
turned higher, rising 0.5% following losses on Wall Street on
Friday.
The Dow Jones Industrial Average .DJI fell 0.38%, the S&P
500 .SPX lost 0.58% and the Nasdaq Composite .IXIC dropped
1.04%.
Australian shares .AXJO jumped 1.4% after the centre-right
Liberal National Coalition pulled off a shock win in federal
elections, beating the left-wing Labor Party.
Japan's Nikkei stock index .N225 added 0.4%, after data
showed growth in the world's third-biggest economy unexpectedly
accelerated in the first quarter. The modest gains on Monday came even as financial markets
remained on edge over the intensifying Sino-U.S. trade war, with
the Trump administration last week adding Huawei Technologies Co
Ltd HWT.UL to a trade blacklist. The repercussions of that move were evident as Alphabet
Inc's GOOGL.O Google suspended business with Huawei that
requires the transfer of hardware, software and technical
services except those publicly available via open source
licensing.
Google's suspension of business with Huawei "signals that
even though the trade talks are being characterised as being
stalled, when we factor in China saying there is no point (in)
U.S. negotiators coming to Beijing in current circumstances as
they did Friday, then the chance of a G20 deal seem more
remote," Greg McKenna, strategist at McKenna Macro said in a
note to clients.
Noting the festering trade war, continued uncertainty over
Brexit and rising tensions between the United States and Iran,
McKenna said investors are currently "headline trading."
"(It's) too soon to see the economic consequences of the
battle escalating. And so belief can be suspended until that
time," he said.
Oil markets, however, saw some active trade early on after
Saudi Arabia's energy minister said on Sunday that there was
consensus among the members of the Organization of the Petroleum
Exporting Countries to maintain production cuts to "gently"
reduce inventories. Both U.S. crude CLc1 and Brent crude LCOc1 jumped more
than 1% following the minister's comments, with West Texas
Intermediate fetching $63.51 a barrel and Brent crude at $73.05
per barrel.
In currency markets, China's offshore yuan CNH=D3
rebounded after touching its weakest level against the dollar
since November on Friday. It was last trading at 6.9280 per
dollar.
In onshore trading on Friday, the yuan weakened past the
psychologically important 6.9 per dollar level to end at its
softest level in 19 weeks. However, sources say the country's
central bank is expected to use foreign exchange intervention
and monetary policy tools to stop it weakening past the
7-per-dollar level in the near term. On Monday, the dollar added 0.2% against the yen to 110.30
JPY= , and the euro EUR= was up 0.1% at $1.1165.
The dollar index .DXY , which tracks the greenback against
a basket of six major rivals, was down a touch at 97.980.
The yield on benchmark 10-year Treasury notes US10YT=RR
rose to 2.4068% compared with a U.S. close of 2.393% on Friday,
while the two-year yield US2YT=RR touched 2.2187%, up from
Friday's U.S. close of 2.202%.
Spot gold XAU= was 0.1% higher at $1,278.42 per ounce.
GOL/