GLOBAL MARKETS-Japan market recovery helps shares bounce back

                                
 * World stocks <.MIWD00000PUS> up 2.2 pct
                                
 * Japan bounces back 4 pct as markets return
                                
 * Risks and uncertainties to temper equity gains
                                
 * Expected ECB rate hike propels euro higher
                                
 
                                
 By Pratima Desai
                                
 LONDON, March 22 (Reuters) - World stocks put in solid gains
on Tuesday as concerns eased about the impact of Japan's triple
disaster on world growth prospects and traders in Tokyo returned
from a national holiday to recoup some of last week's losses.
                                
 Buyers expecting the economy will also ride out continuing
unrest in the Middle East emerged to tap cheap valuations, while
the euro rose to its highest in four and a half months against
the dollar.
                                
 The conflict in Libya, while unrest bubbles in other Arab
states, kept oil prices high and boosted gold, used as a hedge
against rising security concerns. [ID:nTOPMEAST]
                                
 But after a strong sell-off following Japan's earthquake and
tsunami, investors have begun to return to equity markets.
Reports of progress in containing radiation leaks at the
Fukushima plant helped Tokyo shares rally 4 percent <.N225>.
                                
 "The global multispeed recovery remains on a steady path,
with most economies set to experience at- or near-potential
growth in 2011," Roubini Global Economics macroeconomic team
said in a note.
                                
 The pan-European FTSEurofirst 300 <.FTEU3> index of top
shares was 0.5 percent higher at 1,113.23 points at 0944 GMT
after surging 1.8 percent in the previous session, buoyed by
merger and acquisition news in the telecom sector. [.EU]
                                
 U.S. stock index futures pointed to a higher open on Wall
Street, with futures for the S&P 500 <SPc1>, the Dow Jones
<DJc1> and the Nasdaq 100 <NDc1> all up 0.2 percent. [.N]
                                
 The MSCI global stocks index <.MIWD00000PUS> rose 2.2 pct.
<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ 
  Dollar index weekly trendline: http://r.reuters.com/jum68r  
  Japan current account:      http://link.reuters.com/hac68r 
  Graphic on intervention:    http://link.reuters.com/sub68r 
  Earthquake in graphics         http://r.reuters.com/fyh58r   
  Yen stop-loss selling       http://link.reuters.com/fac68r 
^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>  
                                
 
                                
 GOLD AT NEW RECORD
                                
 In currency markets the euro <EUR=> hit $1.4249, its highest
since November, boosted by expectations the European Central
Bank will raise interest rates next month, prompting demand from
real money accounts.
                                
 "Euro/dollar is supported after Trichet continued to signal
a rate hike in April," said Mic Ingenuus, currency strategist at
Nordea in Copenhagen.
                                
 European Central Bank President Jean-Claude Trichet and
other ECB policymakers have reiterated  they are ready to act
quickly to guard against inflation. [ID:nLDE72K0ZO]
                                
 The yen <JPY=> steadied as concerns about possible further
G7 intervention to support the dollar stopped traders from
trying to push the Japanese currency higher. [FRX/] 
                                
 Dollar weakness helped boost commodities such as gold
<XAU=>, which was bolstered by the crisis in the Middle East and
inflationary pressures, triggered by high oil prices.
                                
  "The tension in Libya and the Middle East and North Africa
region is supportive of gold prices. There is little doubt that
gold would test a new high in the near future," said Li Ning, an
analyst at Shanghai CIFCO Futures.
                                
 "In the medium to long term, concerns about inflation will
continue to buoy gold." 
                                
 Spot gold <XAU=> was at $1,429.95 a troy ounce compared with
$1,425.05 late in New York on Monday. Gold hit a record high of
$1,444.40 an ounce on March 7 as the 
                                
 Worries about the disruption of crude supply are expected to
underpin oil prices, even though some investors were taking
profits in anticipation of a slowdown in air strikes against
Libya. [ID:nLDE72L00C]
                                
 Brent crude for May <LCOc1> earlier touched a $115.50
earlier -- less than $5 from a 2-1/2-year high near $120 hit
last month. It was last at $114.69.  [O/R]
                                
 "It now seems likely that there will be a significant loss
of Libyan oil supplies for some time," said Ric Spooner, chief
market analyst at CMC Markets. "This will reduce the buffer of
excess capacity and increase the oil market's vulnerability to
any new supply shocks which may emerge."
                                
 (Additional reporting by Jeremy Gaunt, Jessica Mortimer,
Rujun Shen and Alejandro Barbajosa; editing by Patrick Graham)