* Investors wary as trade deadline draws closer
* Nikkei flat, ASX drifts higher
* Pound wobbles as projected Conservative majority shrinks
* Asian stock markets: https://tmsnrt.rs/2zpUAr4
By Tom Westbrook
SINGAPORE, Dec 11 (Reuters) - Asian stocks flatlined on
Wednesday as Sino-U.S. trade talks approached a weekend deadline
with little sign of progress, while a tightening of the UK
election race knocked the pound.
Investors are beginning to suspect that even if U.S. tariffs
due to take effect on Sunday are delayed, it may be 2020 before
Washington and Beijing can agree a broader rapprochement.
In the absence of detailed trade news, focus moves to the
U.S. Fed's outlook for the economy due at 2000 GMT - along with
an expectation interest rates will be held steady - and
Thursday's British election.
"The market is just so singularly focused on the trade
thematic, it seems to push everything else aside," said James
McGlew, executive director of corporate stockbroking at Perth
broker Argonaut.
"These things never end well. Tariffs and artificial
barriers in economies can never level the playing field the way
proponents theorise it will ... no-one wins until this stops,
its as simple as that."
MSCI's broadest index of Asia-Pacific shares outside Japan
.MIAPJ0000PUS barely budged. Japan's Nikkei .N225 ticked
lower after White House trade adviser Peter Navarro said a
decision on the Dec. 15 tariffs would come soon, also knocking
modest early gains off Australia's S&P/ASX 200 .AXJO .
The biggest mover of the morning was the British pound,
which shed 0.3% to hit $1.3128 after a closely watched YouGov
poll showed the ruling Conservatives tracking toward a much
slimmer majority than forecast a fortnight ago.
The pound had climbed to an eight-month high overnight,
before the survey, as investors priced in a comfortable
Conservative victory and expected it could end years of
uncertainty over Britain's exit from the European Union.
YouGov's research director, however, said the results showed
a hung parliament was possible.
"Granted, this still portrays a Tory majority but given what
is already priced ... the actual outcome has resulted in some of
the heat coming out of a fairly frothy market," said Chris
Weston, head of research at Melbourne brokerage Pepperstone.
TRADE STALEMATE
On the trade front, officials from Canada, Mexico and the
United States signed a fresh overhaul of the quarter-century-old
North American trade pact, but there were few hints of progress
on a deal between the globe's two largest economies.
A Wall Street Journal report that said U.S. and Chinese
officials were preparing for a delay to the Dec. 15 round of
tariffs knocked bonds but did not shift stocks since it
suggested no resolution to the trade conflict. "Assuming it is (delayed), then trade policy uncertainty is
set to linger well into the next decade," said Ray Attrill, head
of FX strategy at National Australia Bank.
"This has very much been the emerging consensus heading into
the weekend deadline, hence the reports have failed to spark any
market volatility."
White House economic adviser Larry Kudlow later said that no
decision had been reached regarding the tariffs, which will
automatically take effect unless they are reversed or suspended.
The Dow Jones Industrial Average .DJI and the S&P 500
.SPX each fell 0.1%, while the Nasdaq .IXIC dropped by a
little less.
The yield on benchmark 10-year Treasury notes US10YT=RR ,
which moves inversely to price, last stood a little higher at
1.8399%.
U.S. inflation data due at 1330 GMT, expected to hold
steady, may further decrease the likelihood of 2020 rate cuts
should it surprise on the upside.
The Fed is widely expected to hold rates steady at the
conclusion of Wednesday's policy meeting, with investors instead
focused on any change to the central bank's view of the economy
and its 2% growth forecast for next year. Elsewhere in currencies, the dollar slipped against the euro
overnight as German economic sentiment sharply rose after an
unexpected rebound in October exports. U.S. crude CLc1 dipped 0.25% to $59.09 a barrel, while
gold was slightly lower XAU= at $1463.526 per ounce.
O/R GOL/