GLOBAL MARKETS-Asia shares push ahead as China markets jump

* Asian stock markets : https://tmsnrt.rs/2zpUAr4
* China blue chips gain 2%, PBOC adds more loans
* Nikkei slips as Japan reports record drop in GDP
* Rise in long-term U.S. yields offers some support to
dollar
* Gold soft after suffering worst week since March

By Wayne Cole
SYDNEY, Aug 17 (Reuters) - Asian shares crept back toward
recent peaks on Monday as Chinese markets swung higher, while
investors waited to see if the recent sell-off in longer-dated
U.S. Treasuries would extend and maybe take some pressure off
the beleaguered dollar.
MSCI's broadest index of Asia-Pacific shares outside Japan
.MIAPJ0000PUS gained 0.5% to 565.74, moving nearer to the
January top of 574.52.
Chinese blue chips .CSI300 led the way with gains of 2.4%,
with the country's central bank providing more medium term loans
to the financial system. Beijing also granted a patent for CanSino Biologics Inc's
6185.HK COVID-19 vaccine candidate Ad5-nCOV. Japan's Nikkei .N225 dipped 0.6% after touching a
six-month peak on Friday, as the country suffered its biggest
economic contraction on record in the second quarter.
E-Mini futures for the S&P 500 ESc1 firmed 0.28% to be
just below the record close of 3,386.15. EUROSTOXX 50 futures
STXEc1 eased 0.1% and FTSE futures FFIc1 0.04%. .N
The U.S. second-quarter earnings season wraps up with the
major retailers reporting this week, including Walmart Inc
WMT.N , Home Depot Inc HD.N and Kohls Corp KSS.N .
Sino-U.S. relations remain a sticking point with U.S.
President Donald Trump on Saturday saying he could exert
pressure on more Chinese companies such as technology giant
Alibaba BABA.N after he moved to ban TikTok. U.S. crude oil shipments to China will rise sharply in
coming weeks, as the world's two top economies gear up to review
their January deal after a prolonged trade war. News that the scheduled review of the U.S.-China Phase-One
trade deal over the weekend had been postponed indefinitely
didn't elicit much of a reaction. THE FED
The highlight of the economic calendar will be the release
of the minutes from the Federal Reserve's last policy meeting.
"Market participants will be looking for insight into the
details and exact timing of when the Fed's Monetary Policy
Review will be completed, and also for more clarity with respect
to the potential timing and structure of any changes to forward
guidance," noted analysts at NatWest Markets.
Speculation is rife the Fed will adapt an average inflation
target, which would seek to push inflation above 2% for some
time to make up for the years it has run below it.
That combined with massive new debt supply caused a sharp
increase in longer-term bond yields last week with 30-year
yields US30YT=RR rising 21 basis points as the curve
steepened.
The lift in yields gave the dollar some respite after weeks
of losses. Against a basket of currencies the dollar was a
fraction lower at 93.016 =USD , still uncomfortably close to
the recent trough of 92.521.
The euro EUR= flattened out a little late last week having
met resistance around the two-year peak of $1.1915. Yet it still
ended the week with a gain of 0.5% and was last holding firm at
$1.1856.
"Investors strategically long EUR/USD should stick to the
position," said CBA forex analyst Elias Haddad. "Greater
Eurozone fiscal solidarity, real two-year swap rate
differentials and relative central bank balance sheet trends
between the Eurozone and the U.S. suggest the fundamental
uptrend in EUR/USD is intact."
The single currency has also made a notable break higher on
the yen EURJPY= to reach ground not trod since April 2019.
Indeed, the yen fell against most of its peers last week, with
the dollar holding at 106.59 yen JPY= on Monday.
In commodity markets, gold steadied at $1,943 an ounce
XAU= , after the jump in bond yields saw it lose 4.5% last week
in its worst performance since March. GOL/
Oil prices edged ahead on hopes for Chinese demand and after
data showed crude oil, gasoline, and distillate inventories all
declined in the week-ending Aug. 7. O/R
Brent crude LCOc1 futures rose 33 cents to $45.13 a
barrel, while U.S. crude CLc1 gained 38 cent to $42.39.

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(Editing by Lincoln Feast and Sam Holmes)