GLOBAL MARKETS-Asian shares edge higher, pound stumbles on Brexit drama

* Asian stock markets: https://tmsnrt.rs/2zpUAr4
* Asian shares shake off early losses
* Pound down after delay to a crucial vote on Brexit
* Oil extends fall due to worries about global economy

By Stanley White
TOKYO, Oct 21 (Reuters) - Asian stocks edged higher on
Monday as Chinese shares reversed early losses due to hopes for
progress in resolving the U.S.-China trade war and expectations
for greater investment inflows into Hong Kong.
MSCI's broadest index of Asia-Pacific shares outside Japan
.MIAPJ0000PUS rose 0.19%. Chinese shares .CSI300 rose 0.13%,
while Japan's Nikkei .N225 rose 0.28%.
The pound slipped from a five-month high against the dollar
and the euro after the British parliament forced Prime Minister
Boris Johnson to seek a delay to an Oct. 31 deadline for
Britain's departure from the bloc.
The vote for an extension dealt a blow to optimism that a
deal agreed last week would ensure Brexit happens with little
economic disruption. Oil futures fell as lingering economic growth concerns and
excess supplies of crude prompted speculators to trim their long
positions. Chinese vice premier Liu He said on Friday that China will
work with the United States to address each other's concerns,
and that stopping the trade war would be good for both sides and
the world. Shares in Hong Kong also got a lift after Chinese bourses
revised rules to allow mainland investors to buy Hong
Kong-listed dual-class shares for the first time. "We've had some positive news from Liu, and allowing Chinese
investors direct access to dual-listed Hong Kong shares is a
another positive," said Sean Darby, global equity strategist at
Jefferies in Hong Kong.
"There is still a lot of money on the sidelines, and there
are only eight or nine weeks left to put that money to work
before we end the year. I expect markets to remain bid."
U.S. stock futures ESc1 rose 0.27% in Asia as investors
brace for high-profile earnings this week from Microsoft Corp
MSFT.O , Amazon.com AMZN.O and others.
The S&P 500 fell 0.4% on Friday partly due to worries about
fallout from the U.S.-China trade war.
A 15-month long trade war between the United States and
China has shown few signs of a durable resolution being reached
despite several rounds of talks.
Financial markets have been whipsawed over this period as a
steady increase in tit-for-tat tariffs have slowed global trade
and raised the risk of recession for some countries.
Underscoring the damage, Japan's exports fell in September
for the 10th straight month, while South Korea's exports for the
first 20 days of October dived 19.5% year-on-year, data on
Monday showed. Hong Kong shares .HSI erased early losses to rise 0.26%.
Chinese bourses on Friday revised rules that would allow
Hong Kong-listed dual-class shares to be included in the Stock
Connect scheme for the first time, potentially benefiting
popular tech companies such as Xiaomi Corp 1810.HK and Meituan
Dianping 3690.HK .
The rule change, which will take effect on Oct. 28, could be
a positive for Hong Kong shares, which have been battered during
months of often violent protest against Chinese rule of the
former British colony.
The pound GBP=D3 fell 0.7% to $1.2911 and was off about
0.4% to 86.46 pence per euro.
The British government insists Brexit will take place on
Oct. 31, but uncertainty over how British lawmakers will respond
could weigh on sentiment for sterling.
The leader of the House of Commons says the government plans
to put the new Brexit deal to a debate and vote on Monday, but
it is unclear if the speaker of the House will let this happen.
Elsewhere in the currency markets, the dollar edged 0.1%
higher to $1.1157 per euro EUR=EBS but held steady at 108.49
yen JPY=EBS .
U.S. crude CLc1 dipped 0.24% to $53.65 a barrel. Brent
crude LCOc1 fell 0.34% to $59.22 per barrel.
Money managers cut their net long U.S. crude futures and
options positions in the week to Oct. 15, the U.S. Commodity
Futures Trading Commission (CFTC) said on Friday.
Long bets on U.S. crude have dropped sharply in the last two
weeks after a spate of weak economic figures worldwide fanned
concerns about global energy demand.
Treasury prices fell in Asia. The yield on benchmark 10-year
Treasury notes US10YT=RR rose to 1.7554%.
Gold XAU= , often considered safe-haven asset, was little
changed at $1,490.12 per ounce.

(Editing by Lincoln Feast)