* China shares bounce, Beijing pledges vigorous fiscal steps

* Longer-term bond yields up globally, focus on BOJ

* Talk U.S. GDP report on Friday could beat forecasts

* Alphabet shares jump to record as results impress

By Wayne Cole

SYDNEY, July 24 (Reuters) – Global bond markets were tense
on Tuesday amid talk of central bank tightening and the risk of
a robust reading on U.S. economic growth later in the week,
though stellar results from internet giant Alphabet supported
tech stocks in Asia.

Shares in the parent of Google climbed 3.6 percent
after hours to hit a record high, valuing the group at a cool
$870 billion.

That made up for an otherwise dull day on Wall Street where
the Dow eased 0.06 percent, while the S&P 500
gained 0.18 percent and the Nasdaq 0.28 percent.

In Asia, Shanghai shares seemed to get a boost from news
Beijing would adopt a more “vigorous” fiscal policy, including
company tax cuts.

Chinese blue chips rose 1.6 percent to a one-month
high, while MSCI’s broadest index of Asia-Pacific shares outside
Japan added 0.47 percent.

Japan’s Nikkei edged up 0.5 percent even as a
disappointing reading on local factory activity suggested the
threat of a trade war was starting to bite.

Bond bulls were still smarting from speculation that the
Bank of Japan is close to announcing measures to scale back its
massive monetary stimulus, a risk that lifted long-term
borrowing costs globally.

Markets were worried that Japanese investors would have less
incentive to hunt offshore for yield, said ANZ economist
Felicity Emmett.

“The 10 basis-point steepening in the Japanese yield curve
is massive in the context of a market that rarely moves more
than 1 basis point,” she added.

“It reflects a broader fear that central banks are reducing
their purchases while U.S. bond supply is set to rise
significantly.”

As a result, 10-year U.S. Treasury yields jumped to their
highest in five weeks around 2.96 percent and were
again nearing the psychological 3 percent bulwark.

GDP GUESSING GAMES

Part of the shift in yields was because of chatter that data
on second-quarter U.S. economic growth (GDP) due on Friday would
easily top current forecasts of 4.1 percent.

Dealers noted some media reports President Donald Trump
himself was predicting an outcome of 4.8 percent. That would not
be out of bounds given the much-watched Atlanta Fed GDP tracker
puts growth at an annualised 4.5 percent.

Such a strong outcome would only add to the risk of faster
rate hikes from the Federal Reserve and underpin the dollar.

Against a basket of currencies, the dollar was hovering at
94.607 compared to a low of 94.207 on Monday. It bought
111.22 yen, against Monday’s trough of 110.75.

The euro lapsed to $1.1690, having run into
profit-taking at a peak of $1.1750 overnight.

China’s yuan went the other way, slipping to a one-year low
on the dollar with Beijing saying its value was driven
by market forces.

In commodity markets, oil prices eased as the focus turned
to oversupply worries and away from escalating tensions between
the U.S. and Iran.

U.S. crude lost 16 cents to $67.73, while Brent
dipped 23 cents to $72.83 a barrel.

Spot gold was a fraction lower at $1,222.82.

(Reporting by Wayne Cole;
Editing by Shri Navaratnam and Eric Meijer)