×

GLOBAL MARKETS-Asia steadies after rally, dollar buoyant before Jackson Hole

* MSCI Asia-Pacific index flat, Nikkei rises 0.5 pct

* Asia loses momentum after previous day's surge

* Dollar supported by warming investor risk appetite

* Copper pulls away from 3-year highs, gold dips

TOKYO, Aug 23 (Reuters) - Asian stocks steadied on Wednesday, taking a breather after the previous day's surge and unable to keep up with a global rally spurred by gains for tech shares on Wall Street and miners in Europe.

The dollar was buoyant against the euro and yen ahead of a meeting of central bankers later in the week.

MSCI's broadest index of Asia-Pacific shares outside Japan , which initially inched up to a two-week high, pulled back to stand little changed following a 0.7 percent rally on Tuesday.

Australian stocks were down 0.4 percent and South Korea's KOSPI gave back earlier modest gains to stand flat.

Japan's Nikkei bucked the trend and rose 0.5 percent, lifted as the dollar strengthened against the yen.

The Nikkei took its cues from Wall Street, which saw the Dow rise 0.9 percent, the S&P 500 climb 1 percent and the Nasdaq gain 1.4 percent on Tuesday as technology shares rallied.

European stocks had also risen overnight, supported by upbeat results from miners and a weaker euro.

Financial markets have been buffeted in recent weeks by heightened tensions on the Korean peninsula, turmoil in the White House and growing doubts about President Donald Trump's ability to fulfil his economic agenda.

Stocks, however, continue to attract buyers in an environment where bond yields remain relatively low and companies have largely notched up strong earnings.

"The return of bargain hunters after a shallow correction in U.S. markets again demonstrates that investors are reluctant to reduce exposure to equity markets given low bond yields, solid profit growth and a lower US$," said Ric Spooner, chief market analyst at CMC Markets in Sydney.

"In a situation where earnings yields on stocks remain attractive in relation to bond yields, investors are reluctant to respond too negatively to 'risk events' unless they represent a clear and present short term danger."

The dollar was 0.1 percent higher at 109.630 yen, putting some distance between a four-month low of 108.605 plumbed last week, when turmoil in the White House and geopolitical tensions took a toll on the greenback.

"The dollar had been caught in a downtrend amid ebbing expectations towards U.S. inflation. It requires a surge in U.S. shares to break this pattern and that is what happened as Wall Street rallied," said Junichi Ishikawa, senior FX strategist at IG Securities in Tokyo.

The dollar also drew support as U.S. Treasury yields rose and pulled away from two-month lows as some of the risk aversion that gripped the broader markets last week began to ebb.

The dollar index against a basket of six major currencies was little changed at 93.522 after rising 0.5 percent the previous day.

The euro was steady at $1.1762 after slipping about 0.5 percent overnight following weaker-than-expected German investor confidence.

A gathering of global central bankers on Friday in Jackson Hole, Wyoming has also prompted investors to rebalance their currency positions ahead of the event, leading them to reduce some of their short dollar bets.

Speeches from Fed Chair Janet Yellen and European Central Bank President Mario Draghi will headline the event, although neither are is expected to announce any significant policy messages.

In commodities, U.S. crude futures slipped 0.25 percent to $47.72 a barrel after data from the American Petroleum Institute showed a crude stockpile decline largely in line with expectations and a surprise build in gasoline inventories.

Copper retreated from a three-year high, and other base metals also fell or trimmed gains, as speculators and funds locked in some profits after a steep rally.

Copper on the London Metal Exchange was down 0.6 percent at $6,539.00 per tonne after striking $6,649 on Tuesday, the highest since November 2014.

Spot gold was a shade lower at $1,284.29 an ounce, extending overnight losses as the precious metal felt pressure from a stronger dollar. Spot gold had reached a nine-month high above $1,300.00 an ounce on Friday.

(Reporting by Shinichi Saoshiro; Editing by Shri Navaratnam)