GLOBAL MARKETS-Ifo lifts stocks, euro; yen also firmer

                                
* MSCI world equity index up 0.6 pct at 219.20
                                
 * Ifo, banking results lift stocks, euro
                                
 * Yen hits 4-week high vs dollar; govt bonds steady
                                
 
                                
 By Natsuko Waki
                                
 LONDON, April 24 (Reuters) - World stocks and the euro rose
on Friday after a bigger-than-expected rise in Germany's key
corporate sentiment survey, while better earnings from several
regional U.S. banks also boosted investor morale.
                                
 The low-yielding yen hit a 4-week high against the dollar,
weighed by nervousness surrounding the looming outcome of the
U.S. government's stress tests on 19 major domestic banks, due
on May 4.
The Ifo Institute's business climate index rose to 83.7 in
April, against a consensus for a rise to 82.3, from 82.2 in
March.
                                
 The focus is also on banks after big U.S. regional banks,
including PNC Financial Services Group <PNC.N> and Fifth Third
Bancorp <FITB.O>, reported better-than-expected first-quarter
earnings on Thursday.
                                
 Earnings results have been so far mixed with investors
reacting more sensitively to positive earnings reports. In
Europe so far, 30 companies in the DJ Stoxx 600 index <.STOXX>
have reported their earnings, of which 18 beat estimates and 12
missed forecasts.
                                
 "The cyclical stocks will continue to benefit from less weak
economic conditions than people feared," said Darren Winder,
equity strategist at Cazenove.
                                
 "The defensive stocks are also attractive (after recent
falls), so the market should get more breath. If it gets more
breath it will help its advance."
                                
 MSCI world equity index <.MIWD00000PUS> rose 0.6 percent on
the day, while the FTSEurofirst 300 index <.FTEU3> extended
gains after the Ifo survey to stand up 0.8 percent.
                                
 Emerging stocks <.MSCIEF> rose half a percent.
                                
 U.S. crude oil <CLc1> rose 0.4 percent to $49.86 a barrel.
                                
 The June bund futures <FGBLc1> was steady on the day.
                                
 The euro rose 0.8 percent to $1.32519 <EUR=>, hitting the
session high after the Ifo survey.
                                
 The yen, which tends to attract safety-seeking flows, hit a
4-week high of 96.65 per dollar <JPY=> with investors nervous
about the result of the U.S. stress tests.
                                
 "Though the end of the stress test process is supposed to
bring much needed transparency, we fear that the cyclical rise
in defaults will cause painful losses - given the unprecedented
rise in the banks' balance sheet over the past 10 years - which
the stress test is likely to highlight," Societe Generale said
in a note to clients.
                                
 The dollar fell half a percent <.DXY> against a basket of
major currencies.
 (Additional reporting by Dominic Lau; editing by Chris Pizzey)