GLOBAL MARKETS-Asia stocks grapple with trade anxiety even as Huawei gets reprieve

* Asian stock markets: https://tmsnrt.rs/2zpUAr4
* Asia stocks shaky, MSCI Asia-Pacific index in and out of
red
* European stock futures slightly higher in early trade
* Oil dips on US stockpile rise, Saudi assurance on market
balance

By Shinichi Saoshiro
TOKYO, May 22 (Reuters) - Asian stocks struggled for
traction on Wednesday, as relief over Washington's temporary
relaxation of curbs against China's Huawei Technologies failed
to offset deeper worries about an intensifying trade war between
the world's two largest economies.
In opening European trade, the pan-region Euro Stoxx 50
futures STXEc1 were down 0.03%, Germany's DAX futures FDXc1
were up 0.01% and Britain's FTSE futures FFIc1 were up 0.28%.
The Chinese markets, which have endured a volatile few
months, were on a cautious note. The Shanghai Composite Index
.SSEC was last a fraction lower.
Australian stocks .AXJO were flat and South Korea's KOSPI
.KS11 edged up 0.2%. Japan's Nikkei .N225 added 0.1%.
MSCI's broadest index of Asia-Pacific shares outside Japan
.MIAPJ0000PUS moved in and out of the red and was last 0.1%
higher.
"Some in the markets will continue to cling on to hopes of
the United States and China reaching an agreement at the
upcoming G20 meeting," said Masahiro Ichikawa, senior strategist
at Sumitomo Mitsui DS Asset Management.
"But the ongoing trade conflict looks to be a protracted
one, and its potentially negative impact on various economies is
becoming a running concern."
Leaders from G20 nations are scheduled to gather for a
summit in Japan at the end of June.
The U.S. Commerce Department on Monday granted Huawei
Technologies Co Ltd HWT.UL a license to buy U.S. goods until
Aug. 19, a move intended to give telecom operators that rely on
Huawei time to make other arrangements. But in yet another sign of a deepening divide between the
world's two biggest economies, the New York Times reported on
Tuesday that the United States could place limits on Chinese
video surveillance firm Hikvision's 002415.SZ ability to buy
U.S. technology.
"Notwithstanding the latest tweet from President Trump that
some restrictions on Huawei had been eased, global equity
markets have continued to underestimate the relentless expansion
of the U.S.-China trade dispute," wrote Sean Darby, chief global
equity strategist at Jefferies.
"The progression from tariffs, to direct actions against
single Chinese companies and their inter-linked supply chains,
has a wide-ranging impact on profitability for corporates in
both economies that investors will find difficult to quantify."
The dollar traded at 110.460 yen JPY= after popping up to
a two-week high of 110.675 against the safe-haven Japanese
currency overnight as U.S. yields rose in the wake of gains by
Wall Street shares. US/
The euro was little changed at $1.1156 EUR= after brushing
a 2-1/2-week trough of $1.1142.
The pound was steady at $1.2712 GBP=D4 . Sterling had sunk
to a four-month low of $1.2685 on Tuesday on Brexit worries but
bounced back after British Prime Minister Theresa May proposed a
"new" Brexit deal. The Australian dollar, sensitive to shifts in risk
sentiment, inched down 0.1% to $0.6878 AUD=D4 . The currency
had suffered losses the previous day when Australia's central
bank governor said interest rates might be cut as soon as next
month. In commodities, U.S. West Texas Intermediate (WTI) crude
futures CLc1 were down 0.89% at $62.57 per barrel after
American Petroleum Institute data showed that U.S. crude
stockpiles rose unexpectedly last week. O/R
Oil was also pressured by Saudi Arabia reiterating that it
would aim to keep the market balanced and try to reduce tensions
in the Middle East. Brent crude futures LCOc1 lost 0.62% to $71.73 per barrel.

(Editing by Sam Holmes & Shri Navaratnam)