Asian stocks surrendered early gains on Tuesday as investors took profits from recent gains, while the dollar was pinned near 15-month lows after Federal Reserve Chairman Ben Bernanke repeated the central bank was likely to keep interest rates at very low levels for some time.

Gold eased off record highs set on Monday but held near $1,140 an ounce, with investors still regarding it as an attractive alternative investment given persistent U.S. dollar weakness and despite bullion's already strong run-up this year.

The dollar edged up against a basket of major trading-partner currencies <.DXY>, off 15-month lows hit overnight, but its broad downtrend was seen as intact on a growing view that U.S. interest rates are likely to stay low for a while.

Markets showed little reaction to talks between U.S. President Barack Obama and Chinese President Hu Jintao in Beijing. Both leaders agreed to work to ease trade and economic frictions between the two giants but appeared to break no new ground on the contentious issue of the value of the yuan.

Obama nudged Hu to allow the yuan currency to appreciate but the Chinese leader had no public comment on either the yuan or the dollar.

Asian stock markets erased early gains by midday, with the yen's strength against the ailing dollar weighing on shares of Japanese exporters and offsetting gains in commodities-linked shares after a surge in oil and gold prices overnight.

The Nikkei average <.N225> fell 0.7 percent, while the MSCI index of Asia Pacific stocks traded outside Japan <.MIAPJ0000PUS> shed 0.4 percent after earlier hitting its highest level since late July last year.

A global equities rally is showing signs of losing steam as it extends into a ninth month. Investors are growing cautious about the prospect for further significant gains amid forecasts for only a sluggish economic recovery next year.

Bernanke's remarks on rates and better-than-expected U.S. retail sales data had fueled broad gains on Wall Street overnight, with the Dow Jones industrial average <.DJI> rising 1.3 percent and the S&P 500 climbing 1.5 percent. <.N>

Bernanke acknowledged in a speech that the dollar's slump was raising some prices but said other factors restraining inflation were winning the day, helping reinforce the market's already benign view toward U.S. interest rates.

Gold took a breather after a record-setting rally and was quoted at $1,137.60/8/40 an ounce in early Tuesday trade, off a fresh high of $1,143.25 set on Monday, although bullion continued to be supported by the dollar's weak outlook.

Spot gold prices have surged some 29 percent so far this year.

U.S. crude futures dipped below $79 a barrel, after settling more than 3 percent higher the previous day, as investors awaited industry data on U.S. stockpiles later in the day to gauge oil demand.

(Additional reporting by Anirban Nag in Sydney; Editing by Kim Coghill)

Japan China Ben Bernanke Barack obama