* Italian 10-year bond yields hit record low
* Yields on US, German bonds rise as stocks advance
* Argentina peso tumbles on plan to reprofile debt
* Gold near six-year high, silver shines
(Updates to open of U.S. markets, changes byline, dateline;
previous LONDON)
By April Joyner
NEW YORK, Aug 29 (Reuters) - U.S. and European shares
advanced on Thursday as China struck a hopeful tone on trade
relations with the United States and as Italy appeared close to
forming a new government and resolving its political crisis.
Wall Street stocks jumped 1% after China's commerce ministry
said Beijing and Washington were discussing the next round of
face-to-face talks scheduled for September. The
comments spurred hopes for progress in the talks and boosted the
Chinese yuan, which snapped a 10-day losing streak.
"We are seeing a bit of a softer tone that's giving
investors hope," said Peter Cardillo, chief market economist at
Spartan Capital Securities in New York.
"Perhaps the September talks might bring some fruitful
conclusions and some progress that could result in lowering
tariffs or getting serious about concluding a trade deal," he
added.
European shares also rose after Italy's president asked
former prime minister Giuseppe Conte to return to head up a new
coalition of the anti-establishment 5-Star Movement and the
opposition centre-left Democratic Party. The coalition is a step toward resolving a three-week
political crisis triggered after League leader Matteo Salvini
pulled his hard-right party out of its governing alliance with
5-Star. Italian stocks .FTMIB rose 1.77%, and the country's
government bonds also rallied, with yields on 10-year bonds
hitting a record low. U.S. Treasury yields, however, moved off recent lows as
stocks rose. Data showing second-quarter U.S. gross domestic
product growth in line with consensus estimates also bolstered
bond yields. Yields on German 10-year bonds DE10YT=RR also ticked
higher.
Among currencies, Argentina's peso ARS= rebounded to trade
little changed against the U.S. dollar after sinking as much as
3% earlier in the day on the country's plans to extend the
maturities on some $100 billion of its debt. On Wall Street, the Dow Jones Industrial Average .DJI rose
287.02 points, or 1.1%, to 26,323.12, the S&P 500 .SPX gained
31.62 points, or 1.09%, to 2,919.56 and the Nasdaq Composite
.IXIC added 109.56 points, or 1.39%, to 7,966.44.
The pan-European STOXX 600 index .STOXX rose 0.95% and
MSCI's gauge of stocks across the globe .MIWD00000PUS gained
0.82%.
Benchmark 10-year Treasury notes US10YT=RR last fell 14/32
in price to yield 1.513%, from 1.468% late on Wednesday.
The dollar index .DXY , tracking it against six major
currencies, rose 0.2%, while the euro EUR= was down 0.14% to
$1.1061.
The Japanese yen weakened 0.33% versus the greenback at
106.48 per dollar. Sterling GBP= was last trading at $1.2188,
down 0.17% on the day.
In offshore trading, the Chinese yuan CNH= was last 0.33%
higher at 7.145 per dollar. Gold edged lower, though it still hovered near a six-year
peak. Spot gold XAU= last fell 0.05% to trade at $1,538.06 per
ounce. Silver XAG= rose 0.98% to $18.51 an ounce after hitting
its highest level since April 2017 at $18.64 earlier in the
session.
In oil markets, U.S. crude extended its gains from Wednesday
on data showing a sharp fall in U.S. inventories, while Brent
held above $60 a barrel. U.S. crude CLc1 rose 1.09% to $56.39 per barrel and Brent
LCOc1 was last at $60.64, up 0.25% on the day.