* MSCI index of world shares touch new 11-month peak
* Dollar skids to one-yr low vs currency basket
* Oil, metals rally on growth optimism; gold at 18-mth high
(Releads with European markets, changes dateline, byline)
By Sujata Rao
LONDON, Sept 16 (Reuters) - World equities rose on Wednesday
to new 11-month highs, after upbeat U.S. data boosted faith in
an economic recovery, persuading more investors to sell their
low-yield dollars to buy growth-oriented stocks and commodities.
This week's data showing a jump in U.S. retail sales has
been interpreted as another sign the world's biggest economy is
indeed on the road to recovery -- signals confirmed by Federal
Reserve Chairman Ben Bernanke who said on Tuesday the worst U.S,
recession since the 1930s was probably over.
The optimism saw fresh cash flood to stock markets worldwide
and bolstered oil to above $71 a barrel and gold to 18-month
highs. The dollar however fell to a one-year low against a
currency basket <.DXY> as investors shifted to riskier assets.
World stocks <.MIWD00000PUS> rose 0.8 percent to the highest
levels since early October 2008, while emerging stocks <.MSCIEF>
surged 1.5 percent to a new one-year high, trading at levels
last touched before the collapse of Lehman Brothers.
"When you have comments coming out from Bernanke about a
technical recession ending, that's increasing the pressure on
the bears, there's a bit of a bear squeeze going on," said Mark
Robinson, head of equity research at Unicredit in London.
"There is also a stronger fundamental element -- the G10 is
pulling out of the slump and Asia is clearly in a V-shape
(recovery). That's driving risk trade and commodities -- in the
last week and a half, and particularly in the last 24 hours, we
have seen a commodity stocks trade," Robinson added.
The FTSEurofirst <> index of top European shares rose
0.8 percent, its eighth rise in nine sessions to the highest
since October 2008. The index is up 20 percent this year.
Asian markets set Wednesday's buoyant tone, sweeping to new
2009 highs, with exporters like South Korea and Australia up 1.8
percent and 2.4 percent respectively <> <>.
Japan's benchmark Nikkei <> added a more modest 0.5
percent, restrained in part by uncertainty over the policies of
new Prime Minister, Yukio Hatoyama. The Bank of Japan began a
two-day meeting but no policy change is anticipated.
Investors even managed to overlook a 1 percent fall in
Shanghai <>, virtually the only Asian bourse to ease on
Wednesday as investors booked profits after three days of gains.
DOLLAR DOWN
The 2.7 percent jump in U.S. August retail sales -- the
fastest growth in 3-1/2 years added to expectations U.S.
economic growth would stage a sizeable rebound in the third
quarter, as businesses rebuild inventories to meet demand.
That augurs well for the currencies of exporting nations,
especially the big commodity producers like South Africa, South
Korea and Australia, probably at the expense of the dollar which
slipped as deep as 76.376 against a basket of currencies -- the
lowest since last October.
The euro powered to new 2009 highs around $1.4690.
The greenback has shed 2.5 percent against the currency
basket this month and is down almost 5 percent since early-July.
"As the global recovery continues and risk diversification
takes place we could see the U.S. dollar stay under pressure for
the next six months," said Amber Rabinov, an economist in
foreign exchange and international economics at ANZ in Sydney.
The yen gained to a near seven-month high versus the dollar
<JPY=> after Japan's incoming finance minister said a strong yen
had advantages for the nation's economy [].
Silver and platinum prices rose in gold's wake while growth
optimism boosted copper and other base metals across the board.
But despite overall exuberance there is some caution,
analysts said, citing warnings by the Fed's Bernanke that
recovery will be slow and it will take time to create new jobs.
Major indexes seem hesitant to make the jump that would take
them past the key one-year anniversary of Lehman Brothers' fall.
"Both sides of the Atlantic are saying we are now out of
recession but growth is going to be slow and anaemic," said
Justin Urquhart Stewart, director at Seven Asset Management.
"The market still has an attitude that money is to be
invested and it's fair value but the economy is showing there is
still going to be weakness."
(additional reporting by Carolyn Cohn and Joanne Frearson in
London; Anirban Nag and Denny Thomas in Sydney; editing by Chris
Pizzey)
