* MSCI All-Country index up for sixth day
* Portugal bailout appears likely after PM resigns
* Euro pares losses, government bonds turn flat
* Oil eases 0.2-0.3 percent, gold steady near record
(Updates lead, refreshes prices, adds comment)
By Amanda Cooper
LONDON, March 24 (Reuters) - Global stocks rose for a sixth
day on Thursday and are now higher than when Japan's earthquake
and tsunami struck, buoyed by confidence that the world economic
recovery remains on track.
The euro also recovered early losses to trade a touch
higher, a day after its biggest one-day fall in six weeks,
despite negative signs from banking and politics in Portugal and
Spain, the two countries now at the centre of Europe's
continuing debt crisis.
The single European currency was set for its largest weekly
slide in a month after the Portuguese parliament rejected a
series of austerity measures and prime minister Jose Socrates
stepped down, although equity markets rallied after gains in the
heavyweight mining sector offset losses elsewhere.
"Sentiment is still relatively good. The cycle is good. We
are still mildly optimistic on the overall picture," said Joost
de Graff, senior portfolio manager at Kempen Capital Manageent
in the Netherlands.
Surveys on Thursday showed economic recovery continued in
March, shrugging off Japan's disaster, although Middle East
tensions are sending prices rocketing and the impact of public
sector cutbacks in Europe is a risk. []
[]
The MSCI All-Country index <.MIW0000PUS> was last up 0.4
percent, having rallied for six successive trading days, its
longest stretch of gains since September 2010.
Brent crude <LCOc1> recovered earlier losses to trade
largely unchanged on the day at $115.54 a barrel, remaining
pressed by concern over instability in the Middle East. []
<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
European sovereign debt crisis: http://r.reuters.com/hyb65p
Q+A-What's next for Portugal? []
Yen intervention: http://link.reuters.com/sub68r
Japan earthquake in graphics http://r.reuters.com/fyh58r
U.S. crude futures chart: http://link.reuters.com/maq68r
^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>
EU BAILOUT
Portugal is unlikely to ask the European Union for a
financial bailout during an EU leaders' summit on Thursday and
Friday, but it cannot be ruled out, an EU source said on
Thursday. []
Much of the anxiety over the euro zone's debt problems had
been soothed by the prospect of a longer-term reinforcement of
the EU bailout fund being agreed at the summit.
But this has now been delayed until June, while Portugal
faces what are viewed as unsustainable borrowing costs ahead of
multi-billion euro bond repayments in April and June.
The premium investors demand to hold Portuguese debt rather
than benchmark German Bunds hit euro-lifetime highs, while the
premium to hold other peripheral debt also rose, reflecting the
growing preference among bondholders to own higher-rated paper.
The euro <EUR=> was last up 0.4 percent against the dollar
at $1.4145, having fallen earlier to a low of $1.4049.
The yen itself was steady against the dollar at 80.90 yen
<JPY=>, although market players are still wary Japan may
intervene to sell the currency if the dollar breaches 80 yen.
"The euro is becoming increasingly immune to issues
affecting the euro zone but the markets may be getting too blase
about the risks," said Jane Foley, senior currency strategist at
Rabobank
Euro zone government bonds were flat, with Bunds having
pared some of their earlier gains to trade at 3.250 percent
<DE10YT=TWEB>, while Portuguese 10-year yields <PT10YT=TWEB>
rose 7 basis points to 7.895 percent, leaving the premium to
Bunds around euro-lifetime highs of 465 basis points.
European shares hit two-week highs, led by gains in the
shares of two major British retailers, although with no end to
the euro zone crisis in sight, investors were cautious. []
After a downgrade for 30 Spanish banks by Moody's helped
drive losses on opening, the FTSEurofirst 300 <> recovered
to rise 0.8 percent at 1,122.09 points, while S&P 500 futures
<SPc1> rose 0.8 percent. [] []
Spot gold <XAU=> rose 0.2 percent to $1,438.45 an ounce,
just shy of a record $1,444.40 set earlier in the month. []
(Additional reporting by Kirsten Donovan and Harpreet Bhal
in London; reporting by Amanda Cooper; editing by Patrick
Graham)
