TREASURIES-Steady to lower in Asia before housing data

* Housing starts data to test renewed econ optimism

* U.S. stock futures hold firm in Asia after Wall St rally

* Resuming bond sales worry some players

By Satomi Noguchi

TOKYO, May 19 (Reuters) - U.S. Treasuries were steady to lower in Asia on Tuesday holding losses made the previous day, with bond investors cautious ahead of housing starts data which could enhance optimism about economic recovery.

The bond market fell on Monday as Wall Street rallied after better-than-expected quarterly profits from the home-improvement sector that gave investors their latest reason to hope the worst of the current recession was over.

The Treasuries market's reaction to the release of the housing start figures later on Tuesday is expected to depend on how stock markets interpret the data.

U.S. stock futures SPc1 were holding firm in Asia, pointing to a potentially solid opening in Wall Street, slightly denting demand for safe-haven debt.

Some market players were also concerned that the market could face downward pressure as bond sales are expected to resume next week after a two-week break.

"The market looks to have entered range-bound trading with the 10-year yield below recent highs around 3.37 percent, and I don't expect today's data to become something to force the market out of that range," said a trader at a Japanese trust bank.

"What concerns me more is whether caution against bond supply will return and put increasing pressure on yields," the trader said.

Benchmark 10-year notes US10YT=RR fell 2/32 in price to yield 3.236 percent, up a basis point from New York trade on Monday when the yield went up about 10 basis points.

The two-year notes US2YT=RR were little changed in price to yield 0.916 percent, while the 30-year notes US30YT=RR slid 7/32 in price to yield 4.198 percent, up about a basis point.

Economists expect data for April to show housing starts rose to 0.52 million from 0.51 million in March, and that building permits increased to 0.53 million from 0.516 million in the same month.

The U.S. Treasury is on Thursday expected to announce two-, five-, and seven-year note sales for next week. (Editing by Joseph Radford)