* MSCI world equity index down 0.1 pct at 295.60
* Europe shares, U.S. stock futures steady; euro near highs
* Oil steady, off 7-week high
By Natsuko Waki
LONDON, March 4 (Reuters) - European stocks and U.S. stock
futures steadied while the euro held near a two-week high on
Thursday as the European Central Bank prepared to unveil next
steps in stimulus withdrawal after its policy meeting.
The premium investors demand for holding Greek government
bonds rather than those of Germany fell as order books for
Greece's long-awaited 10-year syndicated bond swelled, allowing
Athens to cut its planned cost of funding.
As expected, both central banks in the euro zone and the UK
left their interest rate unchanged. The focus for ECB President
Jean-Claude Trichet's news conference and what changes the bank
plans to make to the extra liquidity it has provided for the
banking system since the crisis in 2008. []
Indications from the world's major central banks that they
are ready to withdraw emergency lending has potential to pour
cold water on stocks and other risky assets as their rally since
March 2009 has come to a pause since January.
Such a tone from the ECB, on the other hand, could give a
boost for the euro, which bounced higher on Wednesday from this
week's nine-month low.
"The questions to be partly answered today will be timing,
extent and tenor detail. No info on these would suggest an
uncomfortable ECB. The more detail they give, the more
comfortable they are," said ING rate strategist Padhraic Garvey.
The MSCI world equity index <.MIWD00000PUS> was down 0.1
percent, after hitting a five-week high on Wednesday. The
FTSEurofirst 300 index <> was unchanged on the day.
Emerging stocks <.MSCIEF> fell 0.5 percent.
U.S. crude oil <CLc1> was steady at $90.83 a barrel, off
Wednesday's seven-week high above $81.
The dollar was up 0.1 percent <.DXY> against a basket of
major currencies. The euro was down 0.1 percent to $1.3677
<EUR=>, having hit the two-week high on Wednesday.
Data showed the euro zone economy barely grew in the last
three months of 2009 compared with the previous quarter with the
only driver being exports, which benefits from a weaker euro.
Investors expect the ECB to embark on some minimal
tightening of conditions, most likely in access to 3- and
6-month money.
The ECB could switch back to auctions for its 3-month
funding operations, shortening outstanding maturities as
commercial banks take more money in flat-rate weekly operations.
This would make it easier for the bank to reduce excess
liquidity.
The Bund futures <FGBLc1> rose 4 ticks. The Greek/German
10-year spread narrowed to 281 basis points after widening to as
much as 304 bps earlier.
Final pricing on the 10-year Greek bond was set at mid-swaps
plus 300 basis points as orders topped 10 billion euros.
The country needs to borrow or refinance some 53 billion
euros this year, including 20 billion between April 20 and
end-May. On Wednesday, Greece announced 4.8 billion euros ($6.6
billion) in extra austerity measures designed to secure European
help to tackle its crippling debt burden.
In the money market, three-month yen interbank rates fixed
in London at 0.25063 percent, below the dollar rates <LIBOR> for
the first time since August.
(Additional reporting by Kirsten Donovan, Editing by Ron
Askew)
