* World stocks at new 28-month highs
* Euro gains, Russia says may buy euro rescue fund debt
* Wall Street set to open higher
By Jeremy Gaunt, Europe Investment Correspondent
LONDON, Jan 18 (Reuters) - - World stocks hit a fresh
28-month high on Tuesday, while the euro climbed on new evidence
of robust growth in Germany and signs that policymakers will
eventually firm up plans to ease the euro zone's debt crisis.
Wall Street looked set to open higher, adding to its
relatively solid start to the year.
European finance ministers agreed on Tuesday to take their
time over beefing up a rescue fund for indebted euro zone
countries and delay publishing new stress tests on the region's
shaky banks until the second half of the year.
Russia, however, said it may be interested in buying bonds
from the fund, the European Financial Stability Facility (EFSF).
The euro rose at one point more than 1 percent against the
dollar and was later up 0.8 percent, above $1.34 <EUR>.
Germany's ZEW investor sentiment index surged for the month
as expectations increased that Europe's biggest economy's
powerful export engine will generate new jobs and investments.
Investors, however, remain keen to see euro zone countries
provide more money for the EFSF to ensure that there is enough
to cover any contagion into large economies such as Spain.
Analysts in a Reuters poll expected euro zone policymakers
to increase the firepower of the EFSF by 260 billion euros to
reach 700 billion euros. []
It appeared, however, that EU ministers would not come up
with a new package until leaders' meetings in February or even
March. Investors have nonetheless been stepping back from their
worst case scenarios vis-a-vis the crisis.
"Players are not too keen to push the euro much lower," said
Paul Mackel, director of currency strategy at HSBC. "I am not
too sure if it has the legs to test recent highs given all the
uncertainty surrounding talks on the euro zone safety fund."
Euro zone government bonds sold off slightly, lifting
yields.
NEW HIGHS
World stock markets, meanwhile, focused on broader signs of
an improved outlook for global economic growth and positive
earnings reports.
MSCI's all-country world index <.MIWD00000PUS> touched
levels last seen in late August 2008. It was up 0.6 percent on
the day.
Developed markets outperformed emerging bourses, continuing
recent trends. Attention has shifted among some investors
towards recovering developed economies and away from emerging
markets, which are seen as a slightly crowded trade.
Goldman Sachs told an investor conference on Monday, for
example, that it expected U.S. and Japanese stocks to outperform
in the first half of 2011, with European and emerging stocks
taking over in the second.
The FTSEurofirst 300 <> was up more than 1 percent at
28-month highs with mining stocks leading the way.
"The markets are waiting for an opportunity to move ahead
rather than looking for an opportunity to take profits," said
Mike Lenhoff, chief strategist at Brewin Dolphin.
"The backdrop is still very supportive. This week is a very
big week for corporate earnings in the U.S. and on balance, the
results should be quite good."
Japan's Nikkei <> earlier closed up 0.15 percent.
(Additional reporting by Anirban Nag and Atul Prakash;
Editing by John Stonestreet)
