GLOBAL MARKETS-Asian shares fall after Trump takes aim at China tech firms

* Trump's ban on top China tech firms sours mood
* MSCI ex-Japan Asia down 1%, Tencent falls 9%
* Hopes of U.S. stimulus bolster shares despite lack of
progress
* Gold hits record high, silver gains
* Asian stock markets: https://tmsnrt.rs/2zpUAr4

By Hideyuki Sano
TOKYO, Aug 7 (Reuters) - Asian shares tumbled on Friday
after U.S. President Donald Trump ratcheted up
already-heightened tensions with Beijing by banning U.S.
transactions with China's tech giant Tencent 0700.HK as well
as ByteDance, the owner of video-sharing app TikTok.
MSCI's broadest index of Asia-Pacific shares outside Japan
.MIAPJ0000PUS lost 1% and Hong Kong's Hang Seng .HSI fell
2%. Tencent, Asia's second-biggest company by market
capitalisation, dropped 9.0%.
Mainland China's CSI 300 Index .CSI300 fell 1.3% while
Japan's Nikkei .N225 slipped 0.6%. S&P500 futures ESc1 slid
0.5%.
Trump's executive orders came as his administration said
this week it was stepping up efforts to purge "untrusted"
Chinese apps from U.S. digital networks. Tencent owns the
popular WeChat app. The announcement blew off any excitement from China's trade
data, which showed exports surged 7.2% from a year earlier, way
above economists' forecast of 0.2% fall. The news also poured cold water on what had been a mildly
positive mood in financial markets on hopes U.S. policymakers
will finalise stimulus worth at least $1 trillion to support the
country's fragile economy.
On Wall Street in the previous session, the S&P 500 .SPX
gained 0.64% and the Nasdaq Composite .IXIC added 1%, marking
the fourth straight day of record peaks.
Investors expect another U.S. stimulus package, though the
White House and Democrats remained far apart about its size and
what to include. Risk appetite also got a mild boost after data showed on
Thursday the number of Americans seeking jobless benefits for
the first time fell last week to the lowest level since March.
Still, with a staggering 31.3 million people receiving
unemployment checks in mid-July, there remain worries the labour
market is stalling as the country battles a resurgence in new
COVID-19 cases.
The next focus is a closely-watched employment data by the
U.S. government, due at 1230 GMT, which is expected to show a
payroll increase of 1.58 million in July, compared to 4.8
million in June.
U.S. bond yields have flirted with historic lows, supported
by investors' conviction that the Federal Reserve will keep
monetary policy loose for the foreseeable future and could
strengthen its commitment to low rates as early as next month.
The 10-year U.S. Treasuries yield US10YT=RR fell to a
five-month low of 0.504% and last stood at 0.535%.
Trend-following speculators appear to be buying both stock
futures and bond futures, unusual behaviour as they normally
tend to rotate from one asset to another, said Masanari Takada,
cross-asset strategist at Nomura Securities.
"They seem to be aggressively buying both Treasuries futures
and Nasdaq futures, probably with high leverage as market
volatility, especially that of Treasuries, has been so low. But
this suggests after they have bought everything, there is risk
they will sell everything," he said.
The prospects of a prolonged period of easy U.S. monetary
policy is supporting various asset prices while depressing the
dollar.
Gold XAU= hit a record high of $2,075.2 per ounce XAU=
and last stood at $2,064. Silver has been ballistic in recent
weeks and hit a seven-year high of $29.8384 per ounce XAG= ,
having gained 60% so far this quarter.
The U.S. dollar, which has been in a clear downtrend since
late July, edged back against risk-sensitive currencies after
Trump's move.
The euro fell 0.3% to $1.1838 EUR= while the Australian
dollar shed 0.35% to $0.7214 AUD=D4 . The Chinese yuan eased
0.2% to 6.9670 per dollar CNY=CFXS .
Still, many traders expect the dollar to weaken further.
"The U.S. has spent a massive amount of money for stimulus
and the Fed has expanded balance sheet aggressively. So the
dollar is abundant now," said Tatsuya Chiba, manager of forex at
Mitsubishi Trust Bank.
Oil prices were little changed, with Brent futures LCOc1
down 0.1% at $45.04 per barrel.

(Editing by Lincoln Feast.)