Sydney — Asian shares were struggling to avoid a ninth straight session of losses on Tuesday as the spectre of a China-US trade war haunted investors.

The pound perched near a five-week top on hints a Brexit deal might be nearer.

Japan’s Nikkei fared better on the back of a softer yen and rallied 1%.

Weighing on the yen was news that Japanese chipmaker Renesas was buying US peer Integrated Device Technology for about $6.7bn in cash.

MSCI’s broadest index of Asia-Pacific shares outside Japan eased 0.34% to hit its lowest since July last year.

Most bourses in the region nursed modest losses with Shanghai blue chips off 0.3% and South Korea down 0.4% as investors awaited the next round of trade hostilities.

Having warned last week that he was ready to levy additional taxes on practically all Chinese imports, US President Donald Trump was uncharacteristically quiet on trade on Monday.

China has cautioned it will respond if the US takes any new steps on trade.

Canadian foreign minister Chrystia Freeland will meet the US trade representative in Washington on Tuesday for another round of talks to renew the Nafta trade pact.

On Wall Street, the Nasdaq eked out gains to end four sessions of losses but stocks of insurers slipped as Hurricane Florence barrelled towards the US east coast.

The Dow Jones industrial average fell 0.23%, while the S&P 500 index gained 0.19% and the Nasdaq composite index added 0.27%.

Brexit bets

In currency markets, sterling stood out after the European Union’s top negotiator said an agreement for Britain to leave the economic bloc might be reached in the coming weeks.

The pound has been under pressure on anxiety that Britain would exit from the EU without any formal trading arrangement.

Sterling clambered up to $1.3032, after firming 0.8% overnight.

The euro held at $1.1586, hemmed between support at $1.1524 and resistance at $1.1659.

It had been aided by an easing in concern over Italian debt, which left the gap between yields on Italian and more creditworthy German bonds at the narrowest in a month.

Against a basket of major currencies the dollar was 0.1% firmer at 95.239. It gained on the yen to ¥111.40, but remained within recent ranges.

Emerging market currencies were under pressure with a broad index down near 16-month lows and the Indian rupee near a record trough of 72.675 to the dollar.

"Weakness is set to remain a recurring theme amid global trade tensions, a broadly stronger dollar and prospects of higher US interest rates," said Lukman Otunuga, a research analyst at broker FXTM.

"With turmoil in Turkey and Argentina triggering contagion fears, appetite for emerging market assets and currencies is likely to continue diminishing."

In commodity markets, gold was stuck at $1,193.54 an ounce and continues to move in the opposite direction to the dollar.

Oil prices found support from looming US sanctions against Iran’s petroleum industry.

Brent was 13c firmer at $77.50 a barrel, while US crude inched up 4c to $67.58.