* MSCI world stock index hits two-week highs
* Improved risk appetite weighs on dollar, yen
* Safe-haven government bonds fall, yields climb
By Ian Chua
LONDON, June 3 (Reuters) - Global stocks rose to their
highest in two weeks on Thursday while the dollar sagged after
recent upbeat U.S. data and ahead of the key non-farm payrolls
report.
Improving risk appetite also helped drive commodity prices
higher and boosted demand for higher-yielding currencies such as
the New Zealand dollar, which hit two-week highs against the
dollar <NZD=D4>.
Investors cheered after data on Wednesday showed pending
home sales rose to a six-month high in April. Expectations are
high that Friday's obs data will show the U.S. economy generated
more than 500,000 jobs last month. []
"Yesterday's news on U.S. pending home sales and auto sales
are signs confidence is improving in the economy," said David
Buik, partner at BGC Partners. "We are also expecting decent
U.S. non-farm payroll numbers tomorrow which is quite key."
Global stocks as measured by MSCI <.MIWD00000PUS> climbed
1.4 percent to highs seen on May 19, and emerging markets stocks
<.MSCIEF> rallied more than 2 percent.
The FTSEurofirst 300 index <> of top European shares
put on 2.1 percent with financial shares such as Banco Santander
<SAN.MC> and Barclays <BARC.L> among the bright spots.
Energy stocks ended a four-day losing run, with BP <BP.L>,
which had been battered by the Gulf of Mexico disaster, rising
4.6 percent.
Earlier, Tokyo's Nikkei share average rose over 3 percent
<>, posting its biggest one-day rise in six months.
"At least for today, we're seeing some stabilisation in risk
appetite," said Marcus Hettinger, global currency strategist at
Credit Suisse in Zurich.
DOLLAR, YEN UNDER PRESSURE
Improving risk appetite hit the dollar and further dented a
shaky yen, which lost ground for a second session.
Traders had speculated that Japan's next prime minister
would take a tougher stance in fighting the yen's strength as an
opportunity to trim long positions in the yen, market
participants said. []
Against a basket of major currencies, the dollar <.DXY> fell
0.5 percent.
The dollar, however, rose 0.5 percent versus the yen <JPY=>
to 92.60 yen and the euro gained 0.9 percent to 113.97 yen
<EURJPY=R>.
The New Zealand dollar <NZD=> climbed towards $0.69, its
highest since May 19.
Government bond yields rose as appetite for safe-haven
assets weakened. The 10-year German Bund yield <EU10YT=RR>
climbed 5 basis points to 2.705 percent, while the 10-year U.S.
yield <US10YT=RR> put on 3 bps to 3.379 percent.
Gold <XAU=> also fell, but U.S. crude oil futures <CLc1>
rose $1.24 to $74.10 a barrel and copper <MCU3=LX> climbed 1.0
percent to $6,760.00 a tonne.
(Additional reporting by Joanne Frearson and Naomi Tajitsu;
editing by Jason Webb)
