* Stocks, bond yields fail to gain altitude
* Sterling basks in glow after UK election called
* Gold loses shine as some say geopolitical worries overdone
By Jamie McGeever
LONDON, April 19 European shares edged up on
Wednesday and gold fell as questions hung over the 'reflation'
trades that had lifted markets since Donald Trump became U.S.
president, while sterling held near a six-month high after
Tuesday's calling of a snap UK election.
Wall Street looked set to open higher as corporate earnings
take center stage, with index futures up 0.2-0.3 percent
Yields on safe-haven government bonds rose, the safe-haven
yen fell and copper surged as some in markets suggested
investors' worries over the coming weekend's French presidential
election first round and still simmering tensions over North
Korea appeared to ease somewhat.
The pan-European STOXX 600 index, which hit a
three-week low on Tuesday, was up 0.3 percent, led by gains of
1.5 percent in banks.
Earlier, Asian equities outside Japan hit a one-month low,
while Tokyo shares closed up 0.1 percent.
However, Britain's FTSE 100 index fell a further 0.3
percent following Tuesday's 2.5 percent slide, its biggest fall
since June last year.
British stocks are vulnerable to a rising pound because more
than two-thirds of FTSE 100 company earnings are derived from
operations overseas. The FTSE has erased all its gains for the
Sterling was just off a six-month peak against the dollar
above $1.28 having surged when British Prime Minister
Theresa May called an early general election for June 8, seeking
to strengthen her party's majority ahead of Brexit negotiations.
The dollar rose 0.2 percent against a basket of currencies
but stayed close to Tuesday's three-week lows.
A run of disappointing U.S. economic data and doubts the
Trump administration will progress with tax cuts have quelled
expectations of faster inflation and boosted U.S. Treasuries.
The greenback rose half a percent against the safe-haven yen
, having hit a five-month low on Monday on the mounting
geopolitical tension over North Korea, Syria and the uncertain
French election, and last traded just shy of 109 yen.
The euro dipped 0.1 percent to $1.0720 but held near a
Just four days before the first round of voting in France,
just a few points separate the top four candidates, including
two who oppose the euro -- the far-right's Marine Le Pen and the
far-left's Jean-Luc Melenchon.
"There were probably some nerves around the prospect of
Melenchon making it into the final round, potentially even along
with Le Pen, but that does seem to have faded," said Richard
Benson, co-head of portfolio investment with currency fund
Millennium Global in London.
Others took a different view, suggesting markets were
approaching the vote with complacency.
"There is a real risk that we get a choice between the
far-left and the far-right, neither of which would be
market-friendly, and both of which could leave the EU in a very
different position than it's in today," said Rabobank currency
strategist Jane Foley, in London.
In commodity markets, profit-taking nudged gold down 0.6
percent to $1,282 an ounce and away from Monday's peak of
Oil prices were little changed. Brent crude was last
up four cents a barrel at $54.93.
Copper rebounded from a 14-week low as investors judged that
the recent sell-off on the political uncertainties that have
weighed on metals in recent weeks was overdone. It last traded
at $5,630 a tonne, up 1.1 percent on the day.
(Reporting by Jamie McGeever; Editing by Andrew Heavens and