* Asian shares up, led by gains in Hong Kong * Yen slips to 4-year low as risk sentiment improves * European shares seen steady to slightly lower * Bitcoin near all-time high * Oil prices near multi-year peak, China coal tumbles TOKYO, Oct 20 (Reuters) - Asian shares advanced on Wednesday and U.S. long-dated bond yields edged up to a five-month high on rising optimism about the global economy and corporate earnings, while the yen slipped to a four-year low on the dollar. European stocks are expected to trade steady to slightly lower. Euro Stoxx futures were down 0.2% and Britain’s FTSE futures was almost flat. MSCI’s broadest index of Asia-Pacific shares outside Japan arose 0.65%, led by 1.3% gains in Hong Kong , while Japan’s Nikkei was almost flat and so were mainland Chinese shares, weighed down by more weak data on the property sector. “Earlier this month, stagflation was the buzzword on Wall Street. But now excessive pessimism is receding, especially after strong U.S. retail sales data on Friday,” said Norihiro Fujito, chief investment strategist at Mitsubishi UFJ Morgan Stanley Securities. In New York, the benchmark S&P 500 index gained 0.74% to finish just 0.4% below its early September record close while the CBOE market volatility index fell 0.6 point after earlier hitting 15.57, its lowest level since mid-August. “Tech shares and other high-growth shares that would have been sold on rising bond yields are rallying, which clearly shows that there is now strong optimism on upcoming earnings,” Fujito said. Earning reports will be in full swings in many countries over coming weeks. Dutch chip-making machine maker ASML Holdings and Tesla are among those that will release results later on Wednesday. The positive mood saw U.S. bond yields rising further, with the 10-year U.S. Treasuries yield climbing to as high as 1.673% , a level last seen in May, at one point. It last stood at 1.650%. Shorter yields dipped, however, with the two-year yield slipping to 0.395% from Monday’s peak of 0.448% as traders took profits for now from bets that the U.S. Federal Reserve will turn hawkish at its upcoming policy meeting in early November. Investors expect the Fed to announce tapering of its bond buying and money markets futures are pricing in one rate hike later next year. “The Fed is likely to become more hawkish, probably tweaking its language on its assessment that inflation will be transient. While the Fed will maintain tapering is not linked to a future rate hike, the market will likely try to price in rate hikes and flatten the yield curve,” said Naokazu Koshimizu, senior strategist at Nomura Securities. In the currency market, rising U.S. yields helped to boost the U.S. dollar to a four-year high against the yen of 114.695. In addition to U.S. yields, the yen was dented by expectations of a wider trade deficit in Japan due to rising oil prices and on views the Bank of Japan will stick to loose monetary policy even as other central banks move to tighten their policies. The Chinese yuan held firm, trading at 6.3760 per dollar in the offshore trade, near Tuesday’s 4-1/2-month high of 6.3685. The currency was helped by improving sentiment after China’s central bank said spillover effects from China Evergrande Group’s debt woes were controllable. Risk-sensitive currencies held firm, with the euro ticking up 0.1% to $1.1643. In cryptocurrencies, bitcoin stood at $63,699, near its all-time peak of $64,895 as the first U.S. bitcoin futures-based exchange-traded fund began trading on Tuesday. Oil prices eased slightly in Asia but held near multi-year peaks as an energy supply crunch persisted across the globe. U.S. crude futures traded at $82.59 per barrel, down 0.45% on the day but near Monday’s peak of $83.18, its highest level since 2014. North Sea Brent was off 0.4% at $84.71. China’s coal futures slumped 8% in early Wednesday trade, a day after they fell 8% to their downward limit in night trading, as the state planner said it was looking at ways to intervene and bring record high prices of the fuel back down to a “reasonable range”. Editing by Shri Navaratnam and Kim Coghill