GLOBAL MARKETS-Asian shares inch up in cautious mood over trade, lira stumbles

* Investors nervous ahead of U.S.-China trade talks
* China markets to reopen after week-long holiday
* Turkish lira drops to 1-month low on tension over Syria
* Asian stock markets: https://tmsnrt.rs/2zpUAr4

By Hideyuki Sano
TOKYO, Oct 8 (Reuters) - Asian shares inched up in early
trade on Tuesday, with investors cautious ahead of tense
U.S.-China trade talks while the Turkish lira slipped over
concerns about Ankara's planned incursion in northern Syria.
MSCI's broadest index of Asia-Pacific shares outside Japan
.MIAPJ0000PUS was up 0.13% while Japan's Nikkei .N225 rose
0.53%.
Chinese markets will reopen after a one-week holiday. Hong
Kong-listed ETFs linked to Shanghai 50 index 2823.HK have
fallen 0.8% this period. Hong Kong was closed too on Monday.
Spending on retail goods and dining during China's week-long
National Day holidays returned to growth this year, offering
unexpected respite to an economy that has been expanding at its
weakest pace in almost three decades. On Wall Street, the S&P 500 .SPX lost 0.45% on Monday,
unable to sustain gains made after positive tweets and news
headlines about the trade talks. "Given the importance of the event, markets will be
extremely nervous. I expect things to stay this way for now. On
the whole, markets are not that optimistic about the outlook,"
said Masahiro Ichikawa, senior strategist at Sumitomo Mitsui
Asset Management.
U.S. and Chinese deputy trade negotiators on Monday launched
two days of talks aimed at paving the way later this week for
the first minister-level negotiations in months.
But prospects for progress in U.S.-China trade talks dimmed
after Washington blacklisted Chinese companies over Beijing's
treatment of predominantly Muslim ethnic minorities, and
President Donald Trump said a quick trade deal was
unlikely. The talks are getting underway
ahead of a scheduled increase in U.S. tariffs on $250
billion worth of Chinese goods, to 30% from 25% on Oct. 15.
Trump has said the tariff increase will take effect if no
progress is made in the negotiations.
In the currency market, the biggest mover was the Turkish
lira, which declined more than 2% on Monday over concerns about
Ankara's planned incursion in northern Syria. Trump threatened to destroy Turkey's economy if Ankara takes
a planned military strike in Syria too far even though the U.S.
leader himself has opened the door for a Turkish incursion.
The lira TRYTOM=D3 traded at 5.8375 per dollar, near its
weakest level since Sept. 2.
Major currencies were more range-bound.
The euro stood at $1.0973 EUR= , with its recovery from its
2-1/2-year low of $1.10879 hit a week ago meeting a strong
resistance around $1.10.
The dollar traded at 107.24 yen JPY= , having found some
support around 106.50 yen in the past few sessions.
Sterling traded at $1.2290 GBP=D4 , capped by concerns that
sizeable differences between Britain and the European Union
remained for striking a Brexit withdrawal deal.
The offshore yuan traded at 7.135 yuan per dollar CNH= ,
slightly stronger than just before China's market holiday.
U.S. debt yields jumped back as $78 billion in note and bond
supply slated for auction this week helped push prices lower
after last week's dramatic rise.
The 10-year U.S. Treasuries yield last stood at 1.563%
US10YT=RR .
Oil prices bounced back a tad from falls on Monday, but
remained hobbled by trade uncertainties.
Brent crude LCOc1 futures rose 0.34% to $58.55 a barrel
while U.S. West Texas Intermediate (WTI) crude CLc1 gained
0.47% to $53.00 per barrel.

(Editing by Jacqueline Wong)