*

Asian stock markets : https://tmsnrt.rs/2zpUAr4

*

Nikkei futures off lows, still point to losses

*

Wall St futures rise, Treasuries slip, gold at new record

*

Markets hope for compromise in US-China trade war

*

World leaders meet in Egypt, bankers in Washington

(Adds Asian stocks start, European futures)

By Wayne Cole

SYDNEY, Oct 13 (Reuters) - Asian stocks got off to a

rocky start on Monday after fresh broadsides in the U.S.-China

trade war spooked markets with already stretched valuations,

though there were signs risk sentiment had steadied with Wall

Street futures bouncing.

A holiday in Japan and the United States made for choppy

early trading and political uncertainty still shrouded Japanese

and European assets.

While U.S. President Donald Trump had threatened 100%

tariffs on China from November 1, he sounded more conciliatory

over the weekend, posting that everything would be fine and the

U.S. didn't want to "hurt" China.

Beijing on Sunday defended its curbs on exports of rare

earth elements and equipment as a response to U.S. aggression,

but stopped short of imposing new levies on U.S. products.

"We expect the ultimate resolution will be an extension of

the current tariff pause past November 10 along with some new

but limited concessions from both sides," wrote Jan Hatzius,

chief economist at Goldman Sachs ( GS ) in a note.

"However, the recent policy moves suggest a wider range of

outcomes than was the case ahead of prior U.S.-China talks, with

the possibility of greater concessions but also a risk of

substantial new export restrictions and higher tariffs, at least

temporarily."

Many world leaders, including Trump, are due to meeting in

Egypt on Monday to discuss ceasefire plans for Gaza.

Japanese markets had their own problems with the ascension

of new LDP leader Sanae Takaichi to prime minister now in doubt,

contributing to a sharp rebound in the yen and a 5% dive in

Nikkei futures on Friday.

The Nikkei was closed on Monday. Futures were

trading up 1.3% at 46,690 but that was still far below the cash

close of 48,088.

Shares in South Korea slid 2.1%, while Australia

lost 0.5%. MSCI's broadest index of Asia-Pacific shares

outside Japan dropped 0.6%.

EARNINGS, FED LOOM LARGE

Wall Street was trying to make a comeback with S&P 500

futures rallying 1.1%, while Nasdaq futures jumped

1.6%.

Earnings season kicks off this week with major banks

reporting, including JPMorgan ( JPM ), Goldman Sachs ( GS ),

Wells Fargo ( WFC ) and Citigroup ( C/PN ).

S&P 500 companies overall are expected to have increased

earnings by 8.8% in the third quarter from a year earlier,

according to LSEG IBES, and strong results will be needed to

justify the market's high valuations.

Politics also cast a cloud over Europe as the French

presidency announced Prime Minister Sebastien Lecornu's new

cabinet line-up on Sunday, reappointing Roland Lescure, a close

ally of Emmanuel Macron, as finance minister.

Lecornu's last government lasted just 14 hours, and he still

faces a tough task to steer a budget for 2026 through a deeply

divided parliament.

EUROSTOXX 50 futures edged up 0.2%, while DAX

futures firmed 0.4% and FTSE futures were flat.

Currency markets saw some stabilisation after Friday's rush

into the traditional safe havens of the Japanese yen and Swiss

franc. The dollar gained 0.5% to 151.98 yen, having

slid 1.2% on Friday from a top of 153.29.

The euro was flat at $1.1607, while the dollar

nudged up 0.2% on the Swiss franc to 0.8010. The dollar

index was steady at 99.015, after losing 0.6% on Friday.

In bond markets, cash Treasuries were closed for a holiday

but futures slipped 5 ticks as sentiment steadied.

Yields had hit multi-week lows in the wake of Trump's tariff

threat, while investors had added to wagers on more rate cuts

from the Federal Reserve.

Futures implied around a 98% chance of a quarter-point cut

from the Fed later this month, and a similar probability of

another move in December.

Fed Chair Jerome Powell has a chance to offer his guidance

when he speaks on the economic outlook at the NABE annual

meeting on Tuesday.

A host of other Fed members are appearing this week, along

with a who's who of central bankers attending an IMF-World Bank

meeting in Washington.

In commodity markets, gold remained in high demand as a

hedge against fiscal and political uncertainty, rising 0.5% to

$4,037 an ounce and pipping last week's record to touch

$4,059.

Oil prices also regained some ground on hopes the U.S. and

China would find some compromise on trade to avoid fresh

tariffs.

Brent bounced 1.0% to $63.36 a barrel, while U.S.

crude rose 1.0% to $59.45 per barrel.