By Wayne Cole
SYDNEY (Reuters) - Asian share markets were looking to steam higher on Friday amid reports a last-gasp trade deal had been struck that would avert new U.S. tariffs on China, while Prime Minister Boris Johnson's Conservative Party looked to have won a clear majority in the UK elections.
Sterling surged 2.3% in early Asian trade to .3467 to hit its highest since mid-2018, and reached levels on the euro not visited since mid-2016.
A wave of trade relief overnight had already lifted Wall Street to record highs while hammering safe-haven sovereign bonds and the Japanese yen.
Exit polls suggesting the ruling right-wing Conservatives could gain a commanding 368 seats in Britain's Parliament seemed to settle another uncertainty and added to the cheer.
Early Friday, Nikkei futures (NKc1) were up 1.4% and pointing to a similar gain for the cash index (N225). E-Mini futures for the S&P 500 (ESc1) climbed 0.8%.
Sentiment had soared on reports the United States has reached a "phase-one" trade deal in principle with China, and President Donald Trump had signed off on it.
Wall Street celebrated the news with record highs. The Dow (DJI) ended Thursday up 0.79%, while the S&P 500 (SPX) gained 0.86% and the Nasdaq (IXIC) 0.73%.
Bonds sold off sending yields on U.S. 10-year Treasuries (US10YT=RR) up 10 basis points to 1.89%.
Other safe harbors also took a beating, with the yen sliding across the board. The dollar jumped further to 109.49 yen having risen 0.7% overnight.
The dollar fared less well elsewhere as the pound and the euro both benefited from relief over the UK exit polls. The euro added 0.4% to .1166 (EUR=), while the dollar dipped on a basket of currencies to 96.911 (DXY).
The dollar also lost out to the Chinese yuan to hit an 18-week low as any truce would be a boon for the export-heavy economy. The dollar was last at 6.9432 yuan having shed a steep 1.2% overnight.
Christine Lagarde had struck an upbeat tone on the economy in her first news conference as head of the European Central Bank on Thursday and promised a new style of leadership as she outlined a sweeping one-year review of the bank's workings.
Spot gold eased to ,469.52 per ounce amid the general the shift from safe havens.
Oil prices rallied on hopes a trade deal would support global growth and thus demand. [O/R]
Brent crude (LCOc1) futures rose 64 cents to .36, while U.S. crude (CLc1) added 46 cents to .22 a barrel.