* China PMI beats forecasts, US economic growth revised higher
* Dollar off deep lows, euro bulls turn wary on ECB
* Nikkei at two-week top as yen retreats, still down for Aug
* Gasoline futures surge as refinery closures sap supply
By Wayne Cole
SYDNEY, Aug 31 (Reuters) - Investors discovered a taste for the dollar and commodities on Thursday as upbeat Chinese and U.S. economic news whetted appetite for riskier assets globally, even as tensions over North Korea simmered in the background.
One big gainer was U.S. gasoline which surged 6 percent to two-year peaks as flooding and damage from Tropical Storm Harvey shut nearly a quarter of U.S. refinery capacity. Prices are now up more than 20 percent in the past week.
Adding to the bullish mood, a survey showed Chinese factory growth unexpectedly accelerated in August, confounding forecasts for a slight slowdown. The official PMI firmed to 51.7, from 51.4 in July.
That gave a fresh boost to industrial metals, with copper nearing its highest since late 2014 and on track for gains of 7 percent for August.
European share markets looked set to open firmer, with Eurostoxx 50 futures up 0.4 percent and Germany’s DAX ahead by 0.4 percent.
In Asia, Japan’s Nikkei rose 0.7 percent to its best level in two weeks, helped by a pullback in the yen. The index was still down 1.4 percent on the month, however.
MSCI’s broadest index of Asia-Pacific shares outside Japan edged down 0.1 percent, leaving it a modest 0.3 percent firmer for the month so far.
Wall Street had got a boost on Wednesday when data showed the U.S. economy grew at an upwardly revised 3 percent annualised pace in the second quarter, courtesy of robust consumer spending and strong business investment.
Other figures showed U.S. private-sector employers hired 237,000 workers in August, the biggest monthly increase in five months and an upbeat omen for payrolls on Friday.
The Dow rose 0.12 percent, while the S&P 500 gained 0.46 percent and the Nasdaq 1.05 percent.
The better economic news helped distract from rumblings in the Korean peninsula and lifted the U.S. dollar.
President Donald Trump on Wednesday declared “talking is not the answer” to the tense standoff with North Korea over its nuclear missile development, but his defence chief swiftly asserted that diplomatic options remain.
Against a basket of major currencies, the U.S. dollar crept ahead to 93.015 and away from a 2-1/2-year low of 91.621 touched on Tuesday.
The dollar also bounced to 110.57 yen and off Tuesday’s 4-1/2-month low of 108.25.
The euro recoiled to $1.1873 from its top of $1.2069, weighed in part by speculation the European Central Bank might start to protest at the currency’s strength.
“The ECB meeting is coming up next week and there are rising risks of verbal intervention from Mario Draghi,” said Deutsche Bank strategist George Saravelos.
“Despite this the euro level does not appear particularly extreme and most importantly the ECB has not been driving recent appreciation anyway,” he added. “Verbal rhetoric may cause a correction but is unlikely to be enough to derail euro strength.”
The bounce in the dollar shaved 0.5 percent off the price of gold to $1,302.50 an ounce, short of Tuesday’s 9-1/2-month high of $1,325.94.
With so much U.S. refinery capacity shut in the wake of Tropical Storm Harvey, oil prices were hit by demand concerns. Brent eased 9 cents to $50.77 a barrel, while U.S. crude fell 5 cents to $45.91.
Editing by Kim Coghill & Shri Navaratnam