* China manufacturing data shows robust activity, lifts mood
* Dollar hits 3-mth high versus yen, oil rises
By Kirsten Donovan
LONDON, April 1 (Reuters) - World stock markets rose at the
start of the second quarter, boosted by upbeat data on European
and Chinese manufacturing, while the dollar hit a three-month
high against the yen and the euro slipped.
In Asia, the Nikkei average rose to its highest in a
year-and-a-half, buoyed by the fall in the yen and in Europe,
the FTSEurofirst 300 <> index was up one percent.
The dollar hit a three-month high versus the yen on talk
that Japanese investors will look for higher returns abroad now
that the new fiscal year has started.
World stocks measured in the MSCI All-Country World Index
<.MIWD00000PUS> were up 0.43 percent, after having posted their
fourth consecutive quarterly gain with a 2.7 percent rise in the
first three months of 2010.
Shares were up as two business surveys showed on Thursday
China's vast manufacturing sector moved up a gear in March as
orders climbed, pointing to brisk first-quarter GDP growth.
HSBC's China Purchasing Managers' Index (PMI) showed
first-quarter manufacturing output expanded at the briskest clip
in the survey's six-year history.
The official purchasing managers' index (PMI) rose to 55.1
in March from 52.0 in February, beating the median forecast of
54.5 in a Reuters poll of economists.
"The data looks encouraging. The knock-on effect is in terms
of Chinese expenditure," said Justin Urquhart Stewart, director
at Seven Investment Management.
"You've seen more imports going into China as a result of a
lot of the infrastructure work being done and that impacts
directly into a lot of European companies."
Manufacturing activity in the euro zone also grew at its
fastest pace in over three-years last month, data showed.
The dollar hit a three-month high of 93.73 yen <JPY=> with
traders saying sentiment towards the Japanese currency is
turning bearish heading into the new quarter, while the euro
slipped to $1.3510, remaining vulnerable to sovereign risks
festering in the background.
Sterling gained, hitting a five-week high against the euro
of 88.55 pence, with traders citing an opinion poll showing the
opposition Conservatives could gain a majority in the upcoming
election, diminishing UK political uncertainty.
Benchmark 10-year Treasury yields <US10YT=RR> were up almost
a basis point at 3.8411 percent ahead of manufacturing and
labour market data, while core German euro zone government bonds
remained broadly supported on concerns over debt-laden Greece's
funding strategy.
Ten-year Bund yields <EU10YT=RR> were up 1.5 basis points at
3.105 percent ahead of heavy French new issuance, with the
premium investors demand to hold equivalent maturity Greek bonds
fell around 3 basis points to 346 basis points, according to
Tradeweb data.
"The continued worries about Greece's funding position are
providing good safe-haven bid for Bunds and that looks set to
continue in the near-term," said Nick Stamenkovic.
U.S. crude for May delivery <CLc1> rose 68 cents to $84.44 a
barrel by 0800 GMT, after hitting an intraday high of $84.54 and
settling at $83.76 a barrel on Wednesday, the highest close
since October 2008.
Gold <XAU=> was off earlier highs but remained close to
two-week highs due to bargain hunting ahead of the Easter break.
The market is now awaiting non-farm payrolls data due in the
United States on Good Friday, a holiday for most markets.
Analysts polled by Reuters forecast a 190,000 job gain in
March payrolls, which would be the second monthly increase since
the recession began in December 2007. []
But there is caution in the air after Wednesday's ADP data,
used by some analysts to predict the non-farm payrolls report,
showed private-sector employers cut jobs this month.
Ahead of that weekly jobless claims are due on Thursday at
1230 GMT, with U.S. ISM manufacturing data at 1400 GMT.
(Additional reporting by Harpreet Bhal and Ian Chua in
London; Editing by Toby Chopra)
