GLOBAL MARKETS-Stocks wobble on trade, earnings anxiety; US Treasury yields fall

* All Wall St indexes down; CSX tumbles on trade-related
weakness
* Treasury yields slump; 10yr, 30yr shed over 7 bps each
overnight
* Bank of Korea surprises with earlier-than-expected rate
cut
* Precious metals in demand; gold at 2wk high, silver at
5mth high
* Asian stock markets: https://tmsnrt.rs/2zpUAr4
* European futures point to lower open

By Tomo Uetake
TOKYO, July 18 (Reuters) - Asian share markets faltered on
Thursday as Wall Street stocks dropped on early signs that the
U.S.-China trade war could hurt corporate earnings, which helped
underpin solid demand for safe-haven U.S. Treasuries.
MSCI's broadest index of Asia-Pacific shares outside Japan
.MIAPJ0000PUS retreated 0.3%, while Tokyo's benchmark Nikkei
.N225 skidded 2.0%, its biggest one-day fall in four months.
Chinese shares followed suit, with the benchmark Shanghai
Composite .SSEC and the blue-chip CSI 300 .CSI300 down 0.8%
and 0.7%, respectively, while Hong Kong's Hang Seng .HSI
dropped 0.6%.
South Korea's market .KS11 was off 0.4% after the Bank of
Korea unexpectedly cut its policy interest rate for the first
time in three years, as uncertainties from a trade dispute with
Japan added to anxiety about the economy's outlook. European stocks are also poised for a decisively lower open,
with futures for Britain's FTSE FFIc1 .FTSE falling 0.4%,
Germany's DAX FDXc1 .GDAXI down 1.0% and France's CAC
FCEc1 down 0.5%.
On Wall Street, all three major indexes .DJI .SPX .IXIC
fell on Wednesday as weak results from trade-related CSX Corp
CSX.O stoked concerns that the protracted trade standoff
between the United States and China could hurt U.S. corporate
earnings. .N
Earlier in the week, U.S. President Donald Trump kept up
pressure on Beijing with a threat to put tariffs on another $325
billion of Chinese goods, amid market nervousness over when
face-to-face talks will resume. The Wall Street Journal reported that progress toward a
U.S.-China trade deal has stalled while the Trump administration
determines how to address Beijing's demands that it ease
restrictions on Huawei Technologies. Netflix Inc NFLX.O shares tumbled in after-market trade
after the world's dominant subscription video service lost U.S.
streaming customers for the first time in eight years and missed
targets for new subscribers overseas, raising worries in an
already nervous the market. Treasury yields slid as concerns about the U.S.-China trade
war boosted demand for safe haven debt and after data showed
weakness in the U.S. housing market.
Yields on benchmark 10-year and 30-year bonds climbed more
than seven basis points each, to 2.06% and 2.57%, respectively,
overnight and were last quoted at 2.04% and 2.56%, in that
order.
Even as mortgage rates drop, U.S. homebuilding fell for a
second straight month in June and permits declined to a two-year
low in a possible sign of more trouble ahead for the housing
market. In the foreign exchange market, the dollar slipped on
Thursday as broader risk aversion pushed benchmark U.S. yields
to a nine-day low.
The dollar index .DXY versus a basket of six major
currencies was down 0.2% at 97.08. The index had climbed to a
one-week peak of 97.44 the previous day on
stronger-than-expected U.S. retail sales and a slump in
sterling.
The euro EUR= added to modest overnight gains and edged up
0.1% to $1.124. The single currency's gains were limited as it
was restrained by expectations of easing from the European
Central Bank as early as next week.
The dollar was 0.3% lower at 107.62 yen JPY= , its weakest
level since July 3.
The International Monetary Fund (IMF) on Wednesday said the
dollar was overvalued by 6% to 12%, based on near-term economic
fundamentals. Sterling GBP=D4 was a shade higher at $1.244. It had
stumbled to $1.238, its lowest since April 2017 on Wednesday
amid growing risks of Britain leaving the European Union in a
no-deal Brexit.
"Risks of a no-deal Brexit have increased to worryingly high
levels. Investors should be concerned," said Seema Shah,
London-based chief strategist at Principal Global Investors.
"In the scenario where a no-deal Brexit becomes a realistic
prospect, the continued decline in sterling will be just a drop
in the ocean."
Britain's fiscal watchdog is expected to say on Thursday the
country's economy will fall into a recession next year and that
its economy will be 3% smaller in the event of a "no-deal"
Brexit, The Times newspaper reported. Precious metals were in demand, with gold prices hitting
their highest in two weeks on Thursday, as weaker-than-expected
U.S. data reinforced expectations for an interest rate cut by
the U.S. Federal Reserve later this month, dragging the dollar
lower. GOL
Spot gold XAU=EBS gained as much as 0.2% to hit $1,429.10
per ounce, its highest level since July 3. Silver XAG=EBS
climbed as much as 1.0% to 16.12, its highest level since
February, extending gains for a fourth straight session.
Oil prices steadied on Thursday after falling in the
previous session when official data showed U.S. stockpiles of
products like gasoline rose sharply last week, suggesting weak
demand during the peak driving season. O/R
Brent crude futures LCOc1 were up 0.2% to $63.80 a barrel,
while U.S West Texas Intermediate (WTI) crude futures CLc1
edged down 0.1% to $56.74 a barrel.