GLOBAL MARKETS-China leads as Asia shares ride Wall St gains
* Stocks notch up modest gains, holidays crimp trade
* Major currencies locked in tight ranges, gold firm on safe-haven bid
* Data diary mostly empty, Australia central bank holds rates
* China yuan firms, talk of central bank intervention helps
SYDNEY, May 6 (Reuters) - Asian share markets shuffled higher on Tuesday after promising U.S. economic news helped Wall Street to a firmer finish, though activity was again light with Tokyo still on holiday.
Stock markets in India and China led the way with gains of 0.5 percent each, while MSCI's broadest index of Asia-Pacific shares outside Japan added 0.2 percent.
Markets in Seoul and Hong Kong are also off on Tuesday to celebrate the Buddha's birthday.
The Australian central bank's policy meeting was the only notable economic event in Asia, and the Reserve Bank of Australia (RBA) kept the cash rate at a record low of 2.5 percent, just as markets had priced in.
Australia's main stock index trimmed gains while the Australian dollar firmed a quarter of a U.S. cent after the RBA announced its decision, and said the local currency was high historically, but refrained from calling for it to fall.
"The RBA is trying to be desperately neutral," said Annette Beacher, head of Asia-Pacific research at TD Securities.
"For every positive, they included a negative. They are trying to retreat to the sidelines and the Aussie dollar doesn't know what to do."
Despite the holiday-thinned trading, stock markets did get a fillip after the Institute for Supply Management's U.S. services sector index rose to 55.2 in April, the fastest pace in eight months and easily topping forecasts. A reading above 50 indicates expansion.
The data added to evidence that the U.S. economy is emerging from a particularly harsh winter-induced slowdown and provided a welcome offset to worries about China.
The CSI300 index of the largest Shanghai and Shenzhen A-share listings was up 0.6 percent, while the Shanghai Composite Index edged 0.5 percent higher to 2,036.83 points, although gains were limited by weakness in the property sector as investors braced for any signs of financial distress among developers.
"The U.S. is showing signs of recovering from particularly slow momentum in Q1, driven to a significant extent by adverse weather effects, and the euro area remains on a stable, gradual upward trajectory," noted analysts at Barclays.
"In Japan, the sales tax hike frontloading and payback, which began last month, were largely in line with expectations."
TIGHT FX RANGES
The better U.S. news helped Wall Street recover early losses. The Dow closed up 0.11 percent, while the S&P 500 gained 0.19 percent and the Nasdaq 0.34 percent.
Bonds took the opposite tack with Treasuries surrendering some of the gains made last week. Yields on 10-year paper lurched up to 2.61 percent, having been as low as 2.57 percent.
The U.S. Treasury auctions three-, 10- and 30-year debt this week which will be a useful litmus test of investor demand.
In currency markets, trading was subdued as holidays in London and Tokyo sapped liquidity. The dollar index was steady at 79.499, having drifted between 79.433 and 79.527 on Monday.
The euro stood at $1.3882, having hugged a tight $1.3864-$1.3887 range. Against the yen, the greenback was little changed at 102.02 as was the euro at 141.62.
China's yuan hit its strongest point in two weeks, following talk of central bank intervention to support the currency after it touched an 18-month low last week. Spot yuan hit its strongest level since April 22 in early trade, changing hands at 6.2330 at midday.
In commodities, gold traded near its highest in three weeks at $1,308.9 an ounce, its safe-haven appeal boosted somewhat by the simmering tensions in Ukraine.
Pro-Russian rebels shot down a Ukrainian helicopter in fierce fighting near the eastern town of Slaviansk on Monday, and Kiev drafted police special forces to the southwestern port of Odessa to halt a feared spread of rebellion.
Loss of control of Odessa would be a huge economic and political blow for Ukraine, a country the size of France that borders several NATO countries and aspires to join the military alliance, a primary source of concern for the Kremlin.
Oil prices extended their recent decline. Brent crude for June delivery was off 8 cents at $107.64 a barrel, while U.S. crude eased 2 cents to $99.46 a barrel. (Editing by Jacqueline Wong)
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