GLOBAL MARKETS-Europe stocks get travel boost, dollar slides on stimulus concern

* European stocks bounce off lows, U.S. signalled higher
* Dollar takes fresh hit, gives gold a fillip
* Oil gives up some gains after output cut
* Graphic: 2020 asset performance http://tmsnrt.rs/2yaDPgn
* Graphic: World FX rates in 2020 http://tmsnrt.rs/2egbfVh

By Simon Jessop and Alun John
LONDON, Aug 18 (Reuters) - Europe's blue-chip stocks
rebounded on Tuesday, helped by gains for COVID-19-hit sectors
such as travel and leisure, while the dollar slid on concern
further U.S. fiscal stimulus could face political deadlock.
Despite the large amounts of recovery money sloshing around
the system, the gains were cautious in thin holiday trade, with
markets mindful of an escalating geopolitical tussle between
China and the United States.
The reversal from early lows for the region's blue-chip euro
STOXX 50 .STOXX50E , up 0.5%, was mirrored in U.S. stock
futures ESc1 , which rose 0.2%. That suggested Wall Street's
broadest equity gauge could inch closer to a fresh record high,
a day after a its sister index the Nasdaq hit its own milestone.
The early European weakness had followed a mixed picture in
Asia overnight after a fresh instalment in the escalating spat
between the United States and China.
Amid concern about the close ties between Beijing and Huawei
Technologies Co HWT.UL , U.S. President Donald Trump announced
further restrictions on the maker of mobile phones and other
technology. He is seeking to limit the tech giant's access to
commercially available chips, a move that is likely to disrupt
global supply chains.
The early sea of red for European equities soon turned
green, however, with German, Italian and Spanish stocks gaining
0.6%-0.9%, led by sectors including autos and the travel and
leisure sector.
Britain's blue-chip FTSE 100 .FTSE , the region's biggest
equity market, was also higher by late morning, up 0.4% but held
back slightly by miner BHP Group BHPB.L , which missed on
profits and warned on slowing global growth. One of those backing further gains for equity markets was
Mark Hafaele, chief investment officer at UBS Global Wealth
Management.
"We emphasize a positive outlook for risk assets, but advise
investors that they may need to adjust their strategies to
optimize their portfolio for the next phase of the recovery," he
said in a note to clients.
"Adding risk exposure with markets at or near all-time highs
can be daunting, but studies continue to show that time in the
market is far more important than timing the market."
Investors had to balance the moves against Huawei with
Trump's comments that China was meeting its obligations under
the trade deal, pushing the Chinese currency to a more than
five-month high against the greenback CNY=CFXS .
In other currency markets, the overarching theme was
broadening dollar weakness, which weighed on European government
bond yields and lifted the prices of alternative safe-haven
assets such as gold.
The latest blow to the struggling dollar came from
disappointing manufacturing and mortgage data, which led the
greenback to hit a fresh 5-1/2 year low against the Swiss franc
CHF=EBS . It also neared a two-year low against a basket of its
rivals, hit earlier this month. FRX/
In bonds, benchmark 10-year U.S. Treasuries US10YT=RR were
last down around 1 basis point at 0.6752. In Europe, German
government bond yields held steady at a three-day low, ahead of
flash PMI activity surveys on Friday.
In commodities, oil prices edged lower, giving up a slice of
their recent gains after OPEC+ said the producer grouping was
almost fully complying with output cuts.
Brent crude LCOc1 was down 15 cents, or 0.3%, at $45.22 a
barrel, after gaining 1.3% on Monday. U.S. crude CLc1 was down
0.5%, at $42.68 a barrel, having risen 2.1% in the previous
session
Safe-haven gold closed higher after Berkshire Hathaway also
disclosed a stake in Toronto-based Barrick Gold Corp ABX.TO ,
one of the world's largest mining companies.
Spot gold XAU= added 1.1% to once again breach the $2,000
an ounce barrier, trading at $2,007 an ounce.

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Global assets http://tmsnrt.rs/2jvdmXl
Global currencies vs. dollar http://tmsnrt.rs/2egbfVh
Emerging markets http://tmsnrt.rs/2ihRugV
MSCI All Country Wolrd Index Market Cap http://tmsnrt.rs/2EmTD6j
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(Editing by David Evans and Catherine Evans)