GLOBAL MARKETS-World shares recoup all of Japan disaster losses

                                
 * MSCI world index up, higher than before Japan disasters
                                
 * Portugal bailout likely after PM resigns, yields soar
                                
 * Euro wobbles, then heads higher
                                
 * Oil eases 0.2-0.3 percent, gold steady near record
                                
 
 (Updates lead, refreshes prices, adds comment)
                                
 By Amanda Cooper
                                
 LONDON, March 24 (Reuters) - World stocks rose for a sixth
day on Thursday and are now higher than when Japan's earthquake
and tsunami struck, while Portugal's borrowing costs soared
after its premier quit, making a bailout ever more likely.
                                
 Portugal's crisis had knocked the euro but it recovered
early losses to trade a touch higher, a day after its biggest
one-day fall in six weeks. [FRX/]
                                
 The single European currency was still 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.
                                
 Equity markets were not affected, however, rallying 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
turmoil is pushing prices higher. [ID:nLDE72N0KH]
                                
 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. [O/R]
                                
 Middle East tension "although disquieting is not a game
changer," said Jeremy Batstone-Carr, strategist at Charles
Stanley. "The consensus on Japan is that rebuilding will be
supportive for the Japanese economy in the medium term, and
estimates of global growth rates don't need adjusting too
much."
                                
<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
                                
 European sovereign debt crisis: http://r.reuters.com/hyb65p
                                
 Q+A-What's next for Portugal?               [ID:nLDE72N00Q]
                                
 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
                                
 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.
                                
 Socrates and other Portuguese politicians continue to hold
out against the need for a financial bailout and are not
expected to ask for one at an EU leaders' summit on Thursday and
Friday, an EU source said. [ID:nLDE72N0VV]
                                
 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 yield on 10-year Portuguese debt reached 7.9 percent,
leaving the premium to German government bonds around
euro-lifetime highs of 465 basis points.
                                
 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.
                                
 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. [.EU]
                                
 After a downgrade for 30 Spanish banks by Moody's helped
drive losses on opening, the FTSEurofirst 300 <.FTEU3> recovered
to rise 0.8 percent at 1,122.09 points, while S&P 500 futures
<SPc1> rose 0.8 percent, pointing to a strong start on Wall
Street. [.EU] [.N]
                                
 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. [GOL/]
                                
 (Additional reporting by Kirsten Donovan and Harpreet Bhal
in London; reporting by Amanda Cooper; editing by Patrick
Graham)