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Weak dollar lifts euro above $1.11 for first time this

year

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JD.com ( JD ) shares down as Walmart seeks to sell stake

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Oil steadier, gold holds near record high

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All eyes on Fed's Powell on Friday

(Updates at 1150 GMT)

By Huw Jones

LONDON, Aug 21 (Reuters) - Global shares idled on

Wednesday after a lengthy rebound propelled them towards recent

lifetime highs, with investors waiting for clues on interest

rate cuts from the Federal Reserve on Friday to decide on their

next move.

Oil was steady after a run of declines driven by

stubborn fears over Chinese demand while dollar weakness on the

prospect of rate cuts kept gold near Tuesday's record high.

The MSCI All Country index for global stocks

was flat at 824.73 points, less than 1% below its mid-July

lifetime high and up 13.4% for the year.

In Europe, the STOXX index of 600 companies was up

0.4% at 514 points, nearing its all-time high of 525.59 on June

7.

Stocks have been on a rollercoaster ride this month after

investors took fright following U.S. jobs data that raised the

spectre of recession in the world's biggest economy.

Those worries have since given way to bets on a soft landing

cushioned by cuts in U.S. borrowing costs expected to start in

September.

Preliminary revisions to U.S. labour data are due to be

published after the opening bell on Wall Street. A large

downward revision is expected, which would support the case for

cutting interest rates.

Fed meeting minutes are also expected later on Wednesday to

reinforce a dovish stance ahead of a speech from the central

bank's chair Jerome Powell on Friday.

"We expect the Fed chairman to continue to signal that a

first rate cut is on the cards for September. Yet there is a

chance that investors could be disappointed by the comments, if

there are any references to the stickiness of inflation," said

Guy Stear, head of developed markets strategy at Amundi

Investment Institute.

Interest rate futures have fully priced in a 25 basis point

U.S. rate cut next month, with a 1 in 3 chance of a 50 bps cut.

Almost 100 bps in cuts are priced in for this year, and another

100 bps next year.

A potentially unique situation beckons where there are

material rate cuts but without a recession, unlike the backdrop

for cutting borrowing costs in five of the past seven cutting

cycles, said Ross Yarrow, U.S. equities managing director at

investment bank Baird.

"If we get a scenario where the Fed is cutting, inflation is

falling and employment continues to rise, it really does start

to look like a Goldilocks scenario," Yarrow said.

"So I think the rebound in equities and their prospects from

here are actually pretty good," Yarrow said.

On Wall Street, the S&P 500 snapped eight sessions of

gains with a 0.2% overnight drop as investors took a breather.

U.S stock index futures were firmer.

WALMART SELLS JD.COM STAKE

MSCI's broadest index of Asia-Pacific shares outside Japan

fell 0.4%.

Hong Kong's Hang Seng slid 0.7% with JD.com ( JD )

dropping 8.7% as top shareholder Walmart moved to sell

its large stake.

Japan's Nikkei fell 0.3% as a recovery from its

collapse in early August runs into resistance around the 38,000

level.

The falling dollar has launched gold to record highs and

returned the yen to 146.080 per greenback, a gain of

about 1.6% for the week so far and some 11% higher than last

month's 38-year trough.

The euro is up nearly 3% for August to date and,

at $1.111, is at its highest since early December.

The mood kept bond markets supported and 10-year U.S.

Treasury yields were little changed at 3.816%, while

two-year yields hovered at 3.99%, also little changed

on the day.

Commodity prices stabilised with Brent crude futures

at $77.37 a barrel, up 0.2% on the day.

Dalian iron ore prices climbed more than 4% after a

Bloomberg report that China plans to allow local governments to

buy unsold homes in the latest property-market support measure.

China is the world's biggest steel consumer and markets are

sensitive to any signs that construction could get back on

track.

Big miners' shares were steady in

Australia, and gained in London.

Gold prices hovered at $2,511 an ounce, just below

record levels touched on Tuesday.