- Shares steady on trade hopes
- Nvidia results in focus
- 40-year Japanese government bond auction sees tepid demand
- Dollar steady
LONDON, May 28 (Reuters) - Global shares were steady while the dollar held gains on promising signs on United States trade talks, while attention was turning to earnings from Nvidia later in the day.
Markets remained optimistic over what appeared to be easing trade frictions between the U.S. and Europe, but long-term yields rose again as a lacklustre auction of Japan's longest-dated bonds underscored lingering fiscal deficit concerns.
U.S. President Donald Trump said on Tuesday that the European Union's move to set up talks was positive, after walking back plans over the weekend to impose 50% tariffs on goods from the bloc.
"They are major trading partners so I'm optimistic there will be some sort of agreement in the end," said George Lagarias, chief economist at Forvis Mazars.
Europe's STOXX 600 inched up 0.1%, adding to gains over the last two days. Britain's FTSE and France's CAC 40 both added 0.2%, while Germany's DAX rose 0.3% to another new record, supported again by rising defence stocks.
In Asia, MSCI's broadest index of Asia-Pacific shares outside Japan was little changed. Japan's Nikkei ended flat, after advancing for the previous three sessions.
China's CSI300 blue-chip index slipped 0.1%, while Hong Kong's Hang Seng Index fell 0.6%.
In the U.S., attention was on Nvidia, the last of the "Magnificent 7" tech giants to report earnings this season.
"There is renewed confidence that Nvidia can beat the consensus estimates," said Chris Weston, head of research at Pepperstone.
If Nvidia comes through with better-than-expected sales and profit margins "the rally is on", he added.
The chipmaker is expected to report that first-quarter revenue surged 66.2% to $43.28 billion, according to data compiled by LSEG.
Ahead of the results, Nasdaq futures dipped 0.1%, while S&P 500 futures eased by a similar amount.
EYES ON BOND YIELDS
A rise in longer-dated bond yields resumed on Wednesday, with concerns mounting about fiscal sustainability in many major markets, including the U.S., Japan and Britain.
Those concerns escalated in recent weeks after the U.S. sovereign rating was downgraded by Moody's and as Trump's bill for large-scale tax cuts passed in the House, before moving to the Senate.
"It all starts with the U.S. fiscal incontinence and an apparent repudiation of fiscal discipline," Forvis Mazars's Lagarias said.
"Because they have the global reserve currency, they are testing their ability to borrow as much as they can, but ultimately there is only so much the markets can handle."
Japanese bond yields rose overnight following tepid demand for an auction of 40-year notes, with the 40-year JGB yield rising 9 basis points to 3.375%. Bond yields move inversely to prices.
That lifted long-end yields across the globe, with the U.S. 30-year yield up 4 bps to 4.9769% and the 10-year yield up 3.5 bps to 4.4694%.
In currency markets, the dollar index , which tracks the U.S. currency against a basket of six peers, was steady after a 0.6% rally the day before. The euro was flat at $1.1329 .
The kiwi dollar rose 0.3% to $0.5969 after the Reserve Bank of New Zealand cut rates by 25 basis points as expected.
Oil prices ticked up as the U.S. barred Chevron from exporting crude from Venezuela under a new authorisation on its assets there, raising the prospect of tighter supply.
Brent crude futures rose 0.5% to $64.41 a barrel, while U.S. crude advanced 0.6% to $61.27 per barrel. Spot gold rose 0.7% after dropping more than 1% on Tuesday.
Reporting by Samuel Indyk in London and Rocky Swift in Tokyo; editing by Jamie Freed and Jason Neely
Source: Reuters