Asian shares rise as US-China trade talks progress

Stocks are subdued and the dollar steady amid a lack of detail from US-China trade talks that promised high-level agreement but appeared to do little to resolve longstanding tensions between the world's biggest economies.

Bond investors were also hunkered down for a reading on US inflation due at 8.30am US Eastern time on Wednesday that could show the early impact of tariffs on prices, and a Treasury auction that will test demand for the country's debt.

In London, negotiators from Washington and Beijing said they had "agreed a framework on trade" that would be taken back to their leaders.

US Commerce Secretary Howard Lutnick said the implementation plan should result in restrictions on rare earths and magnets being resolved, but offered no specifics.

"Even though details are scant, as long as the two sides are talking, I think markets will be happy," said Carol Kong, a currency strategist at Australia's Commonwealth Bank.

"It will still be very hard and it will take a long time for both sides to reach a comprehensive trade agreement," she said.

The law was another hurdle as a federal appeals court allowed President Donald Trump's most sweeping tariffs to remain in effect on Tuesday while it reviews a lower court decision blocking them.

Billionaire Elon Musk also said he regretted some of the posts he made last week about Trump, opening the way to a healing of an abrupt rift that has roiled Washington and hurt shares in Musk's Tesla.

Investors in US stocks, who have been badly burned by trade turmoil before, remained cautious, with S&P 500 futures and Nasdaq futures both down 0.2 per cent.

Asian shares were slightly more positive, with MSCI's broadest index of Asia-Pacific shares outside Japan up 0.6 per cent, while the STOXX benchmark for major European shares edged down 0.1 per cent.

The reaction in currency markets was equally muted, with the dollar strengthening slightly against the Japanese yen to trade at 145.15. The euro edged down 0.1 per cent to $US1.1433, nudging the dollar index up to 99.041.

Bond investors also waited for an auction of $US39 billion in 10-year notes later in the day, anxious to see if foreign buyers turn up. Ten-year Treasury yields were little changed at 4.4977 per cent.

Concerns about huge US budget deficits and debt have combined with unease over the White House's shifting policies to make investors demand a higher term premium for holding Treasuries.

Data on US consumer prices for May might also show some initial upward pressure from tariffs, though analysts assume it will take a few months to fully show in the series.

Median forecasts are for the headline consumer price index to rise 0.2 per cent and the core 0.3 per cent, which would nudge the annual rates up to 2.5 per cent and 2.9 per cent, respectively.

Anything higher would be a setback to hopes for more rate cuts from the Federal Reserve and could see bonds sell off. Markets imply little chance the Fed will ease at its meeting next week or in July, but have priced around a 60 per cent chance of a move in September.

In commodity markets, gold gained 0.24 per cent to $US3,329 an ounce.

Oil prices rose to a seven-week high as markets assessed the outcome of the US-China trade talks.

Brent crude futures rose 82 cents to $US67.69 a barrel, while US crude was up 96 cents to $US65.94.