By Andrew Galbraith
SHANGHAI (Reuters) - Asian stocks followed global indexes higher on Thursday, as investors took a less bearish view on the impact of the U.S.-China trade war on markets, a sharp contrast to dim expectations economists had on U.S. growth amid the worsening tensions.
MSCI's broadest index of Asia-Pacific shares outside Japan took its lead from gains on Wall Street overnight, rising 0.2 percent.
Japan's Nikkei stock index was flat, with a recent rally appearing to lose steam as it entered its fifth day. Australian shares eased 0.2 percent.
But gains in the MSCI index were tempered as a rebound in Chinese shares faltered, with the Shanghai Composite index dropping 0.1 percent, reversing early gains.
Shares in Hong Kong also turned lower as the Hang Seng index edged down 0.04 percent. The broad index fell despite encouraging signals about investor appetite in Hong Kong listings from a strong debut by Chinese online food delivery-to-ticketing services firm Meituan Dianping.
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Rob Carnell, chief economist and head of research, Asia-Pacific at ING, said he saw more reasons to take a "glass-is-half-full" approach given the recent emerging market selloff.
"It's not my natural state of being at all, but I'm always looking for the bad in things, and there's plenty out there, and the markets don't really seem to be responding all that much," Carnell said.
U.S. shares had been boosted Wednesday by expectations that the impact of the Sino-U.S. trade war would be smaller than feared, with the U.S. fiscal policy package potentially outweighing any negative impact.
The Dow Jones Industrial Average ended 0.61 percent higher on Wednesday at 26,405.76, its highest close since late January, while the S&P 500 gained 0.13 percent to 2,907.95.
The Nasdaq Composite dropped less than 0.1 percent, to 7,950.04, pulled down by a fall in Microsoft.
On Thursday, S&P 500 E-mini futures were higher by a hair, at 2,910.5.
The broader market sentiment was at stark odds with a new Reuters poll that showed unanimous agreement that an escalating trade war with China was bad economic policy for the United States and could cause economic growth to slow.
The consensus of the poll for U.S. growth showed a slowdown to 2.0 percent in the final quarter of 2019, less than half the last reported rate of 4.2 percent.
Analysts at Citi also cautioned in a note Thursday that U.S. housing data out this week showed signs of weakness despite a headline jump.
Citi said housing starts had been strong, but building permits - a indicator of future activity - were at their lowest since May 2017.
"The housing market remains a specific point of weakness in the U.S. economy and while not in focus, it could be important... housing data on Tuesday wasn't encouraging on net."
The rally in global stocks has been accompanied by falls in U.S. bonds and the Japanese yen. The yield on benchmark 10-year Treasury notes, which on Wednesday touched its highest level since May 18, was at 3.0626 percent Thursday, compared with its U.S. close of 3.083 percent.
This week's rise in yields comes ahead of what is expected to be a hawkish meeting of the U.S. Federal Reserve next week.
All 113 economists in the Reuters poll forecast the Fed to hike rates when it meets Sept 25-26. It is expected to follow that up with one more before the end of this year, taking the fed funds rate to 2.25-2.50 percent.
The two-year yield, which is sensitive to market expectations of Fed rate hikes, was at 2.7907 percent compared with a U.S. close of 2.807 percent Wednesday.
The dollar was 0.1 percent lower against the yen at 112.12. The euro was 0.1 percent stronger against the greenback at $1.1673.
The dollar index, which tracks the dollar against a basket of six major rivals, was down 0.08 percent at 94.466.
U.S. crude added 0.77 percent to $71.67 a barrel, on top of a jump Wednesday that came after new data showed U.S. crude inventories fell 2.1 million barrels last week, its fifth weekly drawdown, to 394.1 million barrels.
That was the lowest level since February 2015.
Brent crude was 0.3 percent higher at $79.67 per barrel.
A weakening dollar continued to push gold higher. Spot gold was trading up 0.2 percent at $1,205.25 per ounce.
(Reporting by Andrew Galbraith; Additional reporting by Herbert Lash in New York. Editing by Eric Meijer and Sam Holmes)