* Sentiment lifts on hopes of U.S.-North Korea meeting
* Euro near 6-1/2 month lows on political turmoil in Italy
* Oil remains in downward spiral, gold flat
By Swati Pandey
SYDNEY, May 29 (Reuters) - U.S. stock futures ticked higher on Tuesday as officials sought to revive what would be a historic meeting between President Donald Trump and his North Korean counterpart, while the euro hovered near 6-1/2 month lows and oil sank.
E-Mini futures for the S&P500 gained 0.2 percent and Dow futures added 0.15 percent. Trade was subdued overnight with market holidays in the world’s two biggest financial centres - London and New York. Singapore markets are closed on Tuesday.
Analysts expect sentiment to improve as South Korean President Moon Jae-in flags more impromptu talks and summits with North Korea’s Kim Jong Un after the pair’s surprise meeting at the weekend.
Kim has reaffirmed his commitment to “complete” denuclearisation of the Korean peninsula.
The dollar was mostly unchanged against the yen at 109.43, having found itself in a narrow range in the past four sessions.
Analysts will next focus their attention on U.S. inflation data due later in the week which could provide clues to future interest rate rises ahead of the Federal Reserve policy meeting next month.
European shares were hammered overnight by worries over an early election in Italy after the anti-establishment 5-Star and League parties abandoned plans to form a government.
Investors feared Italy’s election campaign could focus on the country’s continued membership of European institutions and strengthen the populist parties’ hand.
Political worries also battered Italy’s government bonds, putting renewed pressure on the euro.
The euro was last at $1.1628 from Monday’s $1.1608, its lowest since early November.
“Leaders of the populist Five Star Movement and League parties are now threatening the President with impeachment, and it is clear that the bitter political battle will continue. In this environment, uncertainty and market turbulence look set to continue,” ANZ analysts said in a morning note.
Europe’s STOXX 600 skidded 0.3 percent and Italy’s FTSE MIB benchmark index fell 2.1 percent to its lowest since early March.
MSCI’s main European index slipped 0.8 percent while its Asian counterpart rose 0.3 percent as a retreat in oil prices from record highs helped sentiment.
Oil stayed on a slippery slope on rising expectations that major producers may reverse some of the production cuts they have maintained for 17 months.
A return to the production levels that were in place in October 2016, the baseline for the current arrangement, is one of the options for allowing output to rise, Russia’s energy minister said on Saturday.
Brent crude futures dropped as much as 2.6 percent to $74.49 per barrel, their lowest in about three weeks. They were last at $75.30, down 1.5 percent.
U.S. crude futures stumbled to a six-week low of $65.80 per barrel.
Spot gold was barely changed at $1.344.7 an ounce.
Reporting by Swati Pandey Editing by Eric Meijer