GLOBAL MARKETS-Asian shares near 1-wk top on soothing trade tone, overall mood cautious

(Adds European stock futures, updates prices throughout)
* Asian stock markets : https://tmsnrt.rs/2zpUAr4
* MSCI ex-Japan up 0.7%, E-minis tad weaker
* U.S., China to have face-to-face trade talk in Sept
* Analysts remained cautious about prospect of trade deal
* Currencies muted; gold, silver off recent highs

By Swati Pandey
SYDNEY, Aug 30 (Reuters) - Asian shares jumped to a one-week
high on Friday as the United States and China showed a
willingness to resolve their trade dispute by returning to the
negotiating table, though lingering recession fears tempered
some of the enthusiasm.
MSCI's broadest index of Asia-Pacific shares outside Japan
.MIAPJ0000PUS rose to the highest since Aug. 23, but soon
pared some of those gains after Chinese and Hong Kong stock
markets turned negative. .HSI .CSI300 .SSEC . The MSCI
index was last up 0.8%.
Arrests or detentions of pro-democracy activists in Hong
Kong added to investor jitters with the Chinese-ruled territory
facing its first recession in a decade.
E-Minis for the S&P500 ESc1 also turned negative to be
down 0.1% after more than 1% gain on Wall Street overnight.
In early European trades, futures for pan-region Euro Stoxx
50 STXEc1 were up 0.15%, German DAX FDXc1 0.25% while those
for London's FTSE FFIc1 and France's CAC 40 FCEc1 were a
touch higher.
Japan's Nikkei .N225 jumped 1.2% while South Korea's KOSPI
index .KS11 gained 1.8% and Australian shares .AXJO were
0.9% higher.
The mood lifted after U.S. President Donald Trump said some
trade discussions were taking place with China on Thursday, with
more talks scheduled. China's commerce ministry also said a September round of
meetings was being discussed by the two sides, but added it was
important for Washington to cancel a tariff increase.
The comments spurred hopes for progress in the talks and
boosted the Chinese yuan, which on Thursday snapped a 10-day
losing streak CNY=CFXS . On Friday, it was slightly weaker at
7.1525.
"The S&P futures spike is being blamed largely on the China
trade headlines along with fiscal stimulus hopes and the
prospect for a steeper U.S. curve," JPMorgan analysts told
clients in a note.
"In reality, the headlines are extremely innocuous and don't
differ from what China has said in the past but they crossed
during a dead zone of liquidity and attendance and as a result
are having an outsized influence on trading."
Also boosting sentiment, South Korea finalised the most
aggressive budget spending plan since the 2008/09 global
financial crisis for next year as authorities try to prop-up
Asia's fourth-largest economy amid growing threats both at home
and from abroad. Germany is considering lowering its corporate tax rate while
the U.S. government is thinking about issuing 50- and 100-year
bonds in a bid to steepen the yield curve.
Trade tensions have dominated market sentiment for much of
this year with wild swings in world stocks as rhetoric between
the United States and China fluctuates from conciliatory to
combative.
Worryingly, recent economic data has also pointed to a
global growth slowdown with business investment, manufacturing
activity and exports all going south across major economies.
Investors were focused on a string of economic releases due
over the weekend including China's official manufacturing
survey, which would provide a good gauge of the real impact from
the Sino-U.S. trade war.
"The recent escalation of the tariff war provides no hopes
of a near-term trade deal," ING's Asia economist Prakash Sakpal
wrote.
"As such, we are in for a long stretch of slow growth and
increasingly challenging policy environment, as some central
bankers have warned."
Even so, U.S. Treasury yields rose overnight with the
benchmark 10-year Treasury US10YT=RR climbing to 1.535% from a
three-year low of 1.443% touched earlier this week.
It was last at 1.5112% but still below two-year yields
US2YT=RR at 1.5240%. Such an inversion was last seen in 2007
and correctly foretold the great recession that followed a year
later.
Among currencies, the dollar .DXY was barely changed at
98.533 against a basket of six major currencies. It was 0.1%
lower against the Japanese yen at 106.35 after gains overnight
while the euro EUR= was 0.2% down at $1.10395.
Sterling GBP= eased $1.2178 ahead of a crucial few days
for parliament next week which could even result in a
no-confidence motion and a new election. In commodities, spot gold XAU= came off recent highs to
trade at $1,529.6 an ounce. Silver was at $18.37 an ounce after
hitting its highest level in more than two years. U.S. crude CLc1 slipped 52 cent to $56.19 a barrel while
Brent fell 39 cents to $60.69 a barrel.

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(Editing by Sam Holmes & Shri Navaratnam)