* MSCI world equity index up 0.6 percent at 198.08
* Nestle results beat forecasts; Investors nervous over AXA
* Dollar, government bonds, gold fall
By Natsuko Waki
LONDON, Feb 19 (Reuters) - World stocks rose from the
previous day's three-month low on Thursday while the dollar and
government bonds fell after European corporate quarterly results
came in better than the most pessimistic expectations.
Oil also rose, but European stocks erased early gains after
investors shifted focus firms including AXA <AXAF.PA>, which
fell 9 percent after Europe's biggest insurer's results failed
to erase concerns about the firm's balance sheet.
Nestle <NESN.VX> the world's biggest food group, beat
forecasts with underlying sales growth of 8.3 percent in 2008
and it was cautiously upbeat for 2009.
BNP Paribas <BNPP.PA>'s fourth-quarter loss of 1.37 billion
euros ($1.73 billion) was in line with last month's guidance.
Austria's Raiffeisen International <RIBH.VI>, eastern Europe's
second biggest bank, reported a 17 percent rise in 2008 net
profits.
While European stocks almost erased earlier gains, U.S.
stock futures rose up to 1 percent, improving investor morale.
"There are some rays of lights such as Nestle showing that
consumption in Europe is not as bad as feared yet," said
Hans-Juergen Delp, strategist at Commerzbank.
MSCI world equity index <.MIWD00000PUS> rose 0.6 percent,
having hit a three-month low on Wednesday. The FTSEurofirst 300
index of leading European shares <> was steady on the day.
Emerging stocks <.MSCIEF> gained 1 percent.
U.S. stock futures were up around 1 percent <SPc1>.
U.S. crude oil <CLc1> rose 2.8 percent to $35.60 a barrel.
Euro zone government bonds fell, following losses in U.S.
Treasuries, after President Barack Obama's $275 billion plan to
prop up the housing market fuelled expectations that the
government would increase public borrowing.
"Another day, another initiative," Calyon said in a note to
clients.
"This is how it sometimes feels, and it is perhaps no
surprise that markets are becoming a bit exhausted at trying to
discern the impact of whatever the latest announcement, policy
or programme might be."
The March bund futures <FGBLc1> fell 60 ticks.
The dollar <.DXY> fell 0.9 percent against a basket of major
currencies.
The yen rose 0.3 percent to 93.56 per dollar <JPY=>, after
hitting a six-week low on the previous day.
The Bank of Japan extended its deadline for buying
commercial paper to help corporate funding after leaving its key
policy rate unchanged at 0.1 percent as expected.
Gold fell to $976.05 an ounce <XAU=>, having hit a
seven-month peak of $985.95 earlier.
(Additional reporting by Blaise Robinson; Editing by Victoria
Main)
