GLOBAL MARKETS-Asian stocks bounce on Wall Street's Fed cheer; dollar stays weak

* Powell: Fed will react "as appropriate" to trade war risks
* Asian stock markets: https://tmsnrt.rs/2zpUAr4
* Wall St stocks jump; 10-year Treasury yield off 21-month
low
* Dollar remains under pressure, hovers near 7-week low

By Tomo Uetake
Tokyo, June 5 (Reuters) - Asian shares tracked Wall Street's
rally on Wednesday, after U.S. central bank comments pointed to
increasing prospects of an interest rate cut, boosting investor
sentiment and pushing the dollar lower.
The rebound in stock prices also prompted U.S. bond yields
to step up from their recent lows, with the 10-year yield off
its 21-month low hit earlier in the week.
MSCI's broadest index of Asia-Pacific shares outside Japan
.MIAPJ0000PUS gained 0.5%, while Japan's Nikkei average
.N225 climbed 1.9%.
Chinese shares also rebounded, with the benchmark Shanghai
Composite .SSEC up 0.4% and the blue-chip CSI 300 .CSI300
rising 0.5%, while Hong Kong's Hang Seng .HSI advanced 0.6%.
Supporting the market cheer, Federal Reserve Chairman Jerome
Powell on Tuesday dropped his standard reference to the central
bank being "patient" in its approach to any rate decision,
instead saying the Fed would respond "as appropriate" to the
risks posed by a global trade war and other recent
developments. The comments were interpreted by investors as a clear nod to
a policy easing.
"Powell gave the markets a reason to rally but I think it's
a short-covering bounce, rather than a trend reversal. It's just
the markets have priced in much of the bad news to come," said
Yasuo Sakuma, chief investment officer at Libra Investments.
On Wall Street, the Dow Jones Industrial Average .DJI , the
S&P 500 .SPX and the Nasdaq Composite .IXIC clocked their
biggest one-day gains in five months, with all three indexes
ending up more than 2% on Tuesday. .N
Uncertainties over how, or if, the United States will settle
its trade conflict with its key trade partners, notably China,
have kept many investors on edge.
U.S. Treasury Secretary Steven Mnuchin meets with People's
Bank of China Governor Yi Gang at the G20 finance leaders
meeting this weekend in Japan, a Treasury spokesman said on
Tuesday. Chinese President Xi Jinping said the country's economy is
stable, healthy and well placed to meet all risks and
challenges, according to a transcript published by the Xinhua
news agency. In the foreign exchange market, major currencies were on the
sidelines for now.
The greenback hit a seven week-low of 96.995 against a
basket of six major currencies .DXY overnight and was last
quoted at 97.045, little changed on the day. The euro fetched
$1.1263 EUR= , up by a marginal 0.1%.
The pound recovered from a five-month low on Tuesday but
concerns about a disorderly departure from the European Union
meant gains were minimal, amid promises from U.S. President
Donald Trump of a "phenomenal" post-Brexit trade
deal. Sterling was last trading a marginally firmer
0.1% at $1.270 GBP=D4 .
Other major currencies were relatively calm, with the
safe-haven yen still supported but not aggressively so. The yen
firmed 0.1% against the dollar to 108.08 yen JPY= .
In commodity markets, oil prices resumed their slide on
Wednesday, dragged down by a surprise gain in U.S. inventories
and comments from the head of Russian state oil producer Rosneft
questioning the point of a deal with OPEC to withhold supplies.
O/R
In Asian trade, U.S. crude CLc1 retreated 0.7% to $53.12 a
barrel and Brent crude LCOc1 futures dropped 0.5% to $61.69
per barrel.

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(Editing by Sam Holmes and Jacqueline Wong)