Gloal Markets: Asian markets appeared set to shake off heightened tensions between the US and China and the spread of coronavirus, with stock futures pointing to early gains on Wednesday. Australian S&P/ASX 200 futures rose 0.47% in early trading, Japan`s Nikkei 225 futures were up 0.7%, and Hong Kong`s Hang Seng index futures rose 0.46%. E-mini futures for the S&P 500 rose 0.82%.

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The strong signals for Asian markets came after U.S. investors shook off lingering bad news about the spread coronavirus to send major indices higher on Tuesday, buoyed by a rise in cyclical stocks. The Dow Jones Industrial Average rose over 2%, while the S&P 500 gained 1.34% and the Nasdaq Composite climbed 0.94%.

The stock surge came after three U.S. states reported new record daily deaths from the pandemic, and as tensions continued to grow between the United States and China.

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"Markets have shown a remarkable ability to look through rising infection rates and rising risks of lockdowns," said Michael McCarthy, chief markets strategist at CMC Markets. "At the moment, the market seems to be quite lively and happy to rally on despite those increasing economic risks."

MSCI`s gauge of stocks across the globe closed up 0.53%.

Simmering tensions between the United States and China also loom large, after U.S. President Donald Trump signed legislation and an executive order to hold China "accountable" for the national security law it imposed on Hong Kong.

New data showed U.S. consumer prices rebounded by the most in nearly eight years in June, but a resurgence in new COVID-19 cases after the reopening of businesses suggested weak demand could keep the Federal Reserve injecting money into an ailing economy.

There were still signs of wariness among investors, as yields on leading U.S. and euro-zone government debt fell and safe-haven gold prices solidified gains above $1,800 an ounce.

Fed officials warned the U.S. economy faces a longer recovery from the pandemic, and economic pain could still worsen as cases mount.

The Bank of Japan is expected to hold steady on policy after Wednesday meeting, but investors will be gauging officials` economic projections and any reassurances of additional stimulus if needed.

U.S. gold futures settled mostly unchanged at $1,813.40. Spot gold rose $7.1051 to $1,809.81 an ounce. The 10-year U.S. Treasury note fell 1.5 basis points to yield 0.6250%.

Oil prices rose slightly on Tuesday as OPEC and its allies cut production by more than agreed to in June, although demand concerns lingered. Brent crude futures settled up 18 cents at $42.90 a barrel.

The dollar fell in North American trade on Tuesday as expectations for inflation picked up slightly and the euro rose on optimism about the possibility of a European Union stimulus package.

The Australian dollar rose 0.13% versus the greenback.