GLOBAL MARKETS-Asian stocks boosted by fresh U.S.-China trade hopes

* MSCI AxJ gains 0.15%, close to 2-year peak
* Nikkei +1.5%, ASX 200 +0.4%
* U.S. and China see progress on trade talks
* Asian stock markets: https://tmsnrt.rs/2zpUAr4

By Scott Murdoch and Tom Westbrook
SINGAPORE/HONG KONG, Aug 25 (Reuters) - Asian stock markets
were mostly higher on Tuesday after the U.S and China indicated
progress in trade talks, and as hopes of new coronavirus
treatments boosted broader sentiment among global investors.
MSCI's broadest index of Asia-Pacific shares outside Japan
.MIAPJ0000PUS was up 0.1% and was trading just below a
two-year high.
Japan's Nikkei .N225 rose 1.4%, while banking stocks led
Australia's S&P/ASX 200 .AXJO up 0.34%.
Futures suggest a positive start to Europe's trading day,
with Euro STOXX 50 futures STXEc1 up 0.4% and FTSE futures
FFIc1 up 0.3%. S&P 500 futures ESc1 extended modest gains in
Asia and were last up 0.4%.
The upbeat sentiment in Asia on Tuesday followed reports
that top U.S. and Chinese officials see progress in resolving
concerns around the Phase 1 trade deal reached between the two
countries in January. U.S. Trade Representative Robert Lighthizer and Treasury
Secretary Steven Mnuchin spoke with Chinese Vice Premier Liu He,
the U.S. Treasury said in a statement on Tuesday, during a
"regularly scheduled call".
China's commerce ministry said in a statement there had been
"constructive dialogue", which followed the U.S. Treasury
declaring that "both sides see progress".
Markets have worried that rising tensions between Washington
and Beijing over a host of issues could scupper the deal.
"This is consistent with market expectations of the Phase 1
deal staying healthy and likely to hold even as U.S.-China
tensions flare up along non-trade dimensions - technology,
access to capital, geopolitics," Citigroup analysts said in a
research note.
Bucking the regional rally, however, were Hong Kong and
China markets, with the Hang Seng .HSI slipping 0.4% in the
afternoon session while the Shanghai Composite .SSEC gave up
earlier gains to fall 0.32%. .SS
Ord Minnett investment advisor John Milroy said equities
market sentiment remained driven by elevated global liquidity.
"The strong rebound in markets continues to be driven by the
large amounts of money governments and central banks keep
throwing at the system," Milroy said.
"There is no reason to expect markets to stop anytime soon
even in the face of reduced global activity levels. Investors
keep looking ahead with markets trading well above historical
price to earnings levels."
Markets have also been supported by broader optimism about
medical solutions to end the coronavirus pandemic. U.S.
regulators on Sunday authorised the use of blood plasma from
recovered COVID-19 patients as a treatment option, helping the
S&P 500 .SPX 1% higher to another record close overnight.
Shares of AstraZeneca AZN.L also rose on a Financial Times
report that the U.S. government was considering fast-tracking
its experimental vaccine. That seemed to overshadow a rise in coronavirus cases in
Europe and the first documented case of human re-infection with
COVID-19, where a man in Hong Kong caught the virus again some
four months after first being infected. In currency markets, the dollar edged higher, defying
pressure from a gain in stocks that often leads investors to
sell dollars for riskier currencies. FRX/
Investors are awaiting a Thursday speech from Federal
Reserve Chairman Jerome Powell and expect he might address the
future approach to inflation, possibly allowing it to run hotter
than 2% to make up for years of undershooting.
The dollar also found support from an overnight rise in
yields. That kept the euro EUR=EBS to $1.18 and the Aussie
AUD=D3 at $0.7170 in Asian trade.
In commodity markets, oil clung to overnight gains after
storms disrupted U.S. production. Brent crude futures LCOc1
firmed 8 cents, or 0.2%, to $45.21 a barrel and U.S. crude
CLc1 dipped to $42.52.
The stronger dollar held gold XAU= to $1,929.6 an ounce. A
light data calendar in Asia has investors looking to Germany's
IFO business survey due at 0800 and U.S. consumer confidence
data at 1400 GMT.