GLOBAL MARKETS-Asia shares supported by upbeat U.S. manufacturing, but virus woes cap gains

* Asian stock markets: https://tmsnrt.rs/2zpUAr4
* U.S. ISM data boosts Asian shares
* Gold near record high as virus risks remain
* Oil gives up gains on expected output increase

By Stanley White and Julie Zhu
TOKYO/HONG KONG, Aug 4 (Reuters) - Asian shares advanced on
Tuesday thanks to strong U.S. manufacturing data and upbeat tech
stocks, though broader worries about the coronavirus and global
economy saw some markets trim early gains.
MSCI's broadest index of Asia-Pacific shares outside Japan
.MIAPJ0000PUS rose 0.41%, but shares in China .CSI300 edged
0.04% lower on simmering Sino-U.S. tensions. Australian stocks
.AXJO gained 1.88% for the biggest intraday gain since July
21. Tokyo shares .N225 also jumped by more than 1%.
Euro Stoxx 50 futures STXEc1 were up 0.49%, German DAX
futures FDXc1 rose 0.53%, while FTSE futures FFIc1 were up
0.13%.
Oil futures gave up their overnight gains and fell due to
nagging worries about an increase in the supply of crude. U.S.
stock futures ESc1 were 0.24% higher.
An industry gauge released overnight indicated U.S.
manufacturing activity expanded in July at the fastest pace in
more than a year, which helped Wall Street shares rise on
Monday. However, some investors remain cautious due to worries about
a resurgence of the coronavirus and a diplomatic tussle over
Chinese tech companies' operations in the United States.
"It has been an upbeat U.S. trading session and Asia will
absorb the leads accordingly," Chris Weston, head of research at
Pepperstone, said in a market note.
On Monday the Dow Jones Industrial Average .DJI rose
0.89%, the S&P 500 .SPX gained 0.72%, and the Nasdaq Composite
.IXIC advanced 1.47% to set a record closing high as investors
cheered the manufacturing data. That data also caused the U.S. Treasury curve to steepen, an
indication of improved investor sentiment. U.S. stocks received an additional lift from Microsoft
MSFT.O , which jumped 5.6% after it formally declared interest
in buying the U.S. operations of TikTok, a popular video-sharing
app owned by Chinese tech company ByteDance. U.S. President Donald Trump has threatened to ban TikTok
unless its U.S. operations are sold off from ByteDance.
Washington is also preparing to take action against other
Chinese software companies that could share user data with
Beijing, setting the stage for further conflict. The dollar held steady against its counterparts as traders
awaited progress in negotiations for additional economic
stimulus.
U.S. House Speaker Nancy Pelosi will meet with Treasury
Secretary Steven Mnuchin and White House Chief of Staff Mark
Meadows on Tuesday to continue talks, raising hopes for a
breakthrough sometime soon. The "only good thing we can say on the political impasse in
Washington is that negotiations remain ongoing," analysts at
National Australia Bank said in a market note.
Chicago Federal Reserve Bank President Charles Evans on
Monday called forcefully for more U.S. government spending to
support the economy, saying "demand trouble is brewing" as
existing relief policies expire.
Spot gold XAU= was down 0.18% on Tuesday but still near a
record high of $1,984.66 set on Monday amid support from virus
fears. U.S. crude CLc1 dipped 0.17% to $40.94 a barrel, while
Brent crude LCOc1 fell 0.23% to $44.05 per barrel due to
worries about extra supply coming to market.
Russia has started to increase oil and gas output, a source
told Reuters. Other oil producers are also expected to increase
output this month after OPEC and its allies agreed to ease
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Tracking the spread of the novel coronavirus https://graphics.reuters.com/CHINA-HEALTH-MAP/0100B59S39E/index.html
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