GLOBAL MARKETS-Asian shares nudge higher on stimulus hopes, recession fears ease

* Asian stock markets: https://tmsnrt.rs/2zpUAr4
* Risk aversion eases on stimulus hopes
* Stocks get a boost, bond yields rebound
* Traders look to policymakers for more stimulus clues

By Stanley White
TOKYO, Aug 20 (Reuters) - Asian shares extended their gains
on Tuesday as hopes for stimulus in major economies tempered
anxiety about a global recession, helping boost riskier assets
and drawing money from safe-havens such as bonds and gold.
MSCI's broadest index of Asia-Pacific shares outside Japan
.MIAPJ0000PUS nudged up 0.04%, while Japan's Nikkei .N225
jumped 0.47%. The improved mood was helped by a rally on Wall
Street overnight, with the S&P 500 .SPX gaining 1.21%
Oil futures were also down in a tentative sign that worries
about an attack at a Saudi oil field over the weekend have
eased, but some traders were nervously monitoring an Iranian
tanker at the centre of a clash between Tehran and Washington.
For now, however, investors were cheered by signs
policymakers were willing to do more to support their economies
in the grip of international trade frictions, led by the
bruising Sino-U.S. tariff tussle.
The immediate focus shifts to the minutes of the U.S.
Federal Reserve's last meeting due on Wednesday. Traders are
also keenly waiting on the Fed's Jackson Hole seminar and a
Group of Seven summit this weekend for clues on what additional
steps policymakers will take to bolster growth.
Senior White House officials are discussing a temporary
payroll tax cut to boost the economy, the Washington Post
reported on Monday. Hopes for additional stimulus are rising after reports that
Germany is prepared to increase fiscal spending, and after the
People's Bank of China took steps to lower corporate borrowing
costs.
"There are expectations for looser monetary policy
everywhere in the world, and this is cushioning the markets
against recent uncertain developments," said Masayuki Kichikawa,
chief macro strategist at Sumitomo Mitsui Asset Management Co.
"China is prepared to do a lot for its economy. I hope to
hear more about fiscal spending in Germany. Central banks have
no choice but to ease. The remaining question is what comes from
fiscal policy." U.S. stock futures ESc1 were a shade lower in Asian
trading, down 0.15%, while benchmark 10-year Treasuries yields
US10YT=RR eased slightly to 1.5944%, and 2-year yields traded
at 1.5289%.
Markets overwhelmingly expect the Fed to cut rates again at
its Sept. 17-18 policy meeting from the current 2.00%-2.25%. The
Fed cut rates in July for the first time in a decade to mitigate
the effects of the U.S.-China trade row and a global slowdown.
Last week, financial markets went into a tailspin after the
Treasury yield curve briefly inverted when short-term yields
traded above those of long-term paper. Investors, who feared a
steep global downturn given an inverted yield curve has presaged
several past U.S. recessions, dumped riskier assets.
However, a bounce in yields from lows hit last week has
eased some of the concerns about the global economy.
Gold XAU= , which is traditionally bought as a safe-haven
during times of uncertainty, held steady at $1,497.02 per ounce
after tumbling 1.2% on Monday, its biggest daily decline in
about a month.
The Swiss franc CHF= , another safe-haven asset, was last
quoted at 0.9810 per dollar, near a two-week low.
In the oil market, U.S. West Texas Intermediate futures
CLc1 fell 0.41% to $55.98 a barrel in a sign of receding
concern about tension in the Middle East, but some traders warn
this lull could be temporary.
Refinitiv data shows an Iranian tanker that was detained in
Gibraltar is now on its way to Greece, but the U.S. State
Department has warned that any assistance to the vessel could be
considered as providing support to a U.S.-designated terrorist
organisation. (Editing by Shri Navaratnam)