* Asian stock markets : https://tmsnrt.rs/2zpUAr4
* China trims short-term interest rate, in surprise move
* Helps Asia share markets reverse early losses
* Markets look to Fed minutes, ECB Lagarde speech
* Pound inches up as opinion polls favour Tories
By Wayne Cole
SYDNEY, Nov 18 (Reuters) - Asian shares blipped higher on
Monday after Beijing surprised markets by trimming a key
interest rate for the first time since 2015, stirring
speculation that more stimulus was on the way for the world's
second-largest economy.
China's central bank cut rates on seven-day reverse
repurchase agreements by five basis points to 2.50%, a move that
nudged the yuan higher while lowering Chinese bond yields.
The news helped Shanghai blue chips recoup early losses to
rise 0.3% .CSI300 , though the initial reaction was cautious
overall. MSCI's broadest index of Asia-Pacific shares outside
Japan .MIAPJ0000PUS also moved 0.3% higher.
Japan's Nikkei .N225 added 0.38%, and was just short of
its recent 13-month top. E-Mini futures for the S&P 500 ESc1
were all but flat, as were EUROSTOXX 50 futures STXEc1 .
Beijing's policy move added to hopes it might also be more
serious about making progress in trade talks with the United
States.
On Saturday, Chinese state media said the two sides had
"constructive talks" on trade in a high-level phone call that
included Vice Premier Liu He, U.S. trade representative Robert
Lighthizer and Treasury Secretary Steven Mnuchin. "Markets remain at risk of further short-term volatility
given issues around trade, Iran & the Middle East, impeachment
noise and weak global economic data," said Shane Oliver head of
investment strategy and chief economist at AMP Capital.
"But valuations are okay – particularly against low bond
yields - global growth indicators are expected to improve
through next year and monetary and fiscal policy are becoming
more supportive."
WAITING ON THE FED
In currency markets, the dollar was little changed against
its main peers on Monday and well within recent tight trading
ranges. Indeed, volatility in the market has been the lowest in
decades recently and shows no sign of shifting.
The dollar edged up on the safe-haven yen to 108.81 JPY= ,
after bouncing on Friday. Chart support lies at 108.23 with
stiff resistance at 109.48.
The euro idled at $1.1058 EUR= having found support at
$1.0987 last week. Investors are awaiting the first major speech
by European Central Bank President Christine Lagarde due on
Friday for clues on future policy.
Sterling nudged up to $1.2923 GBP=D3 as more polls showed
the Tories well ahead in the election race. Against a basket of currencies, the dollar was a shade
softer at 97.944 .DXY .
The dollar and bonds are likely to be sensitive to minutes
of the Federal Reserve's last policy meeting, set to be
released on Wednesday.
"The minutes are likely to reiterate that the U.S. economy
is 'solid' and that current monetary policy settings are
'appropriate', which would support the dollar," said Joseph
Capurso, a currency analyst at Commonwealth Bank of Australia.
However, he noted the soft report on October U.S. retail
sales released on Friday suggested previously strong consumption
was showing some cracks. "Any further weakness in consumption could warrant a
material reassessment of the outlook by the FOMC. Under our
baseline, the FOMC would most likely start cutting interest
rates again in 2020," said Capurso.
Spot gold eased to $1,465.67 per ounce XAU= as it tracks
every passing twitch in risk appetite.
Oil prices were supported after Brent touched a seven-week
high on Friday. O/R
Brent crude LCOc1 futures firmed 2 cents to $63.32, while
U.S. crude CLc1 added 10 cents to $57.82 a barrel.
Asia stock markets https://tmsnrt.rs/2zpUAr4
Asia-Pacific valuations https://tmsnrt.rs/2Dr2BQA
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(Editing by Sam Holmes)