Asia shares edge up with US futures, oil gains

Asia shares edge up with US futures, oil gains

MSCI's broadest index of Asia-Pacific shares outside Japan inched up 0.1%, while Japan's Nikkei recouped early losses to gain 0.3%.

S&P 500 futures added 0.4% and Nasdaq futures 0.6%. EUROSTOXX 50 futures rose 0.6% and FTSE futures 0.9%.

Chinese blue chips climbed 1.2% after a survey confirmed service sector activity contracted in May, but the Caixin index did improve to 41.4 from 36.2.

Markets will be on tenterhooks for the U.S. consumer price report on Friday, especially after EU inflation shocked many with a record high last week.

Forecasts are for a steep rise of 0.7% in May, though the annual pace is seen holding at 8.3% while core inflation is seen slowing a little to 5.9%.

A high number would only add to expectations of aggressive tightening by the Federal Reserve with markets already priced for half-point hikes in June and July and almost 200 basis points by the end of the year.

Some analysts thought Friday's upbeat payrolls report suggested the Fed was on track for a soft landing.

"May's numbers came in about as good as the Fed could expect," said Jonathan Millar, an economist at Barclays.

"It's a good sign that the Fed's plans to cool the labour market are playing out favourably so