GLOBAL MARKETS-Asia shares come off 4-mth low, euro steady after fragmented EU vote

* Asian stock markets: https://tmsnrt.rs/2zpUAr4
* Pro-Europe vote limits nationalist gains in EU election
* European shares seen opening modestly higher
* Volumes thin with UK, US markets closed for market
holidays

By Tomo Uetake and Shinichi Saoshiro
TOKYO, May 27 (Reuters) - Asia stocks inched up but remained
near four-month lows on Monday amid concerns about U.S.-China
tensions while the euro stayed in a narrow range after the
weekend's European Parliament elections.
MSCI's broadest index of Asia-Pacific shares outside Japan
.MIAPJ0000PUS rose 0.2 percent, off a four-month low touched
on Friday, with market holidays in the U.S. and U.K. denting
trading volumes.
European shares were expected to open modestly higher, with
futures for Eurex EURO STOXX 50 index STXEc1 and Germany's DAX
.FDXc1 ticking up 0.4 and 0.3 percent, respectively.
Casting a shadow over many share markets were worries the
China-U.S. trade conflict was turning into a technology cold war
between the world's two largest economies.
Japan's Nikkei average .N225 advanced 0.3%.
Chinese shares rose, helped by investor hopes of policy
support from Beijing, with the benchmark Shanghai Composite
.SSEC climbing 1.4% and the blue-chip CSI 300 .CSI300 adding
1.3%. Hong Kong's Hang Seng .HSI dropped 0.1%.
Wall Street's major indexes edged higher on Friday in a
rebound from the previous session after comments from U.S.
President Donald Trump on trade relations with China provided
markets a bit of a respite. .N
The euro EUR= was a shade higher at $1.1209, holding
within a tight $1.2272-$1.2754 range in what was a limited
reaction to partial returns in the European parliament
elections.
Analysts said the single currency's muted reaction came as
the results showed populist and far-right parties in some
countries were unlikely to have gathered as much support as
anticipated.
Parties committed to strengthening the European Union held
on to two-thirds of seats in the EU parliament, official
projections from the bloc's elections showed on Sunday, though
far-right and nationalist opponents saw strong gains.
Macron's Renaissance, built on the ruins of centre-left and
centre-right parties, added to gains for liberals at the EU
level as turnout bounced sharply across the bloc. Along with a
surge for the Greens, that meant four groups occupying the
pro-EU middle ground lost under 20 seats, securing 505 seats out
of 751.
"With a turnout of more than 50%, European elections were
far less of a non-event than usual," Robert Carnell, ING
Asia-Pacific research head, said in a note to clients.
"This was not a ringing endorsement for Euroscepticism -
with only 22% of the seats going to EU sceptical parties, and
even this bolstered by what may be a temporary surge in the UK's
Brexit party seats, the EU parliament remains a largely
pro-European institution."
A centrist, pro-EU coalition would still be possible in the
new chamber that will sit for the first time on July 2. But it
would be more difficult to piece together among more numerous
partners, according to the European Parliament's estimates.
The longer-term impact of the election, therefore, remained
unclear, analysts say.
"It's difficult to foresee what will happen to Brexit, the
political situation in Italy and elections in Greece just by
looking at the vote count," said Shin Kadota, senior strategist
at Barclays in Tokyo.
"We may not see an immediate market reaction, as the
election outcome will have to seep in first before beginning to
have a political impact on the various countries."
The pound was 0.2% higher at $1.2740 GBP=D4 . Sterling had
bounced back from a near five-month trough of $1.2605 after
British Prime Minister Theresa May said she would quit. GBP/
The dollar index against a basket of six major currencies
.DXY was little changed at 97.575.
The greenback was holding at 109.48 yen JPY= , 0.2% higher
on the day.
China's yuan rose to a 1-1/2-week high against the U.S.
dollar on Monday, buoyed by a senior official's warning not to
bet against the Chinese currency. In the spot market, onshore yuan CNY=CFXS rose to a high
of 6.8854 yuan per dollar at one point, the strongest since May
16, and was last quoted at 6.8926 yuan per dollar, up 0.1% on
the day.
China's banking and insurance regulator said over the
weekend that it did not expect a persistent decline in the yuan
and warned speculative short sellers they would suffer "heavy
losses" if they bet against the currency. Oil prices fell on Monday, extending losses from last week
when crude dropped the most this year on concerns the Sino-U.S.
trade war could trigger a broad economic slowdown, although
OPEC's supply cuts provided some support. O/R
Front-month Brent crude futures LCOc1 , the international
benchmark for oil prices, dropped 0.2% to $68.58 per barrel
while U.S. West Texas Intermediate (WTI) crude futures CLc1
shed 0.6% to $58.27 per barrel.