GLOBAL MARKETS-Asian shares ease as Trump rekindles Sino-U.S. trade tensions

* MSCI Asia ex-Japan edges lower
* Trump says China not living up to promises
* China June trade data due Friday
* Asian stock markets: https://tmsnrt.rs/2zpUAr4

By Andrew Galbraith
SHANGHAI, July 12 (Reuters) - Asian shares pulled back on
Friday as worries over renewed Sino-U.S. trade tensions weighed
on sentiment ahead of the release of June trade data from China,
though expectations of a Federal Reserve rate cut later this
month kept losses in check.
Those bets remained strong despite a rise in U.S. consumer
inflation in June, and helped to lift the S&P 500 index to a
record closing on Thursday. S&P 500 e-mini futures ESc1 were
last up 0.21% at 3,010.25.
Federal Reserve Chairman Jerome Powell indicated on Thursday
that a rate cut is likely at the Fed's next meeting as
businesses slow investment due to trade disputes and a global
growth slowdown. On Friday, MSCI's broadest index of Asia-Pacific shares
outside Japan .MIAPJ0000PUS was down 0.05% in early deals,
with Australian shares .AXJO dipping 0.16% and Japan's Nikkei
stock index .N225 trimming 0.11%.
"Markets have enjoyed a bit of a calm spot in the U.S.-China
trade war saga since the announcement of a truce and restarting
of trade talks at the G20 meeting. Unfortunately, headlines are
once again beginning to emerge," ANZ analysts wrote in a morning
note.
U.S. President Donald Trump said on Thursday that China was
not living up to promises it made on buying agricultural
products from American farmers. "While this wasn't a big market mover, it does serve as a
reminder that things could flare up again," the analysts said.
Later on Friday, China will release trade data for June,
with analysts expecting exports to have fallen as weakening
global demand and a sharp hike in U.S. tariffs took a heavier
toll on the world's largest trading nation. On Thursday, the S&P 500 .SPX gained 0.23% to end at a
record closing high of 2,999.91 points and the Dow Jones
Industrial Average .DJI also hit a record high close of
27,088.08 points, rising 0.85% on the day.
The Nasdaq Composite .IXIC fell 0.08%.
U.S. Treasury yields were higher following weak demand for a
$16 billion 30-year bond auction on Thursday and after the U.S.
Labor Department said its consumer price index excluding food
and energy rose 0.3% in June, its biggest increase since January
2018. The poorly received auctions had pushed the 30-year yield as
high as 2.672% on Thursday, according to Refinitiv data.
The yield on benchmark 10-year Treasury notes US10YT=RR
was last at 2.1361%, up from its U.S. close of 2.12% on
Thursday, while the 30-year yield touched 2.6512%, up from a
close of 2.639%.
The two-year yield US2YT=RR , which rises with traders'
expectations of higher Fed fund rates, was at 1.8605%, up from a
close of 1.852%.
"The CPI report will have no material impact on Fed guidance
nor have a significant influence on the great Fed debate
around 25 or 50," said Stephen Innes, managing partner at
Vanguard Markets Pte, referring to expectations of the size of a
July rate cut.
"After all, the FOMC is unquestionably willing to let
inflation run hotter after spending the better part of a decade
trying to ignite those flames," he said.
The dollar fell 0.09% against the yen to 108.38 JPY= ,
while the euro EUR= edged 0.06% higher to buy $1.1259.
The dollar index .DXY , which tracks the greenback against
a basket of six major rivals, was flat at 97.044.
Oil prices picked themselves up after taking a tumble on
Thursday, after the Organisation of the Petroleum Exporting
Countries said it expected the world would need 29.27 million
barrels per day (bpd) of crude oil from its members in 2020,
1.34 million bpd less than this year. Global benchmark Brent crude LCOc1 gained 0.53% to $66.87
per barrel and U.S. West Texas Intermediate (WTI) crude CLc1
was up 0.61% to $60.57 a barrel.
Gold prices, dulled by the stronger-than-expected U.S.
consumer inflation data, regained some of their shine. Spot gold
XAU= last traded up 0.28% at $1,407.56 per ounce. GOL/