* World stocks flirt with gains after two sessions of losses
* Japan at 11-week closing low; Europe up 0.5 percent
* Dollar weaker after little talk from G7
By Jeremy Gaunt, European Investment Correspondent
LONDON, Oct 5 (Reuters) - World stocks flirted with gains
after two sessions of losses on Monday with Japan's Nikkei
hitting an 11-week closing but Europe climbing.
The dollar was generally weaker and the Australian dollar
gained on talk of interest rate hikes.
Friday's worse-than-expected U.S. jobs report continued to
weigh and investors were also wary ahead of the new U.S.
corporate earnings season, which begins this week.
"The tone of the market has been dominated by the (U.S.)
employment report," said Bernard McAlinden, investment
strategist at NCB Stockbrokers. "The market was overbought, and
had had a diet of positive surprises."
World stocks as measured by MSCI <.MIWD00000PUS> were up
around 0.1 percent for a month-to-date loss of around 3 percent.
Investors had been pulling back from equities a bit after a
hefty rally that began in March.
The FTSEurofirst 300 <> was up around half a percent
after hitting a four-week closing low on Friday.
Japan's Nikkei average <>, however, fell 0.6 percent to
hit an 11-week closing low, dented by shares of exporters on
concerns over the fragility of the U.S. economic recovery.
The latest U.S. earnings season begin on Wednesday when
aluminium company Alcoa Inc <AA.N>, a Dow component, is
scheduled to post quarterly results.
With second-quarter earnings primarily boosted by
cost-cutting, investors want to see if the latest quarterly
results will show an improvement in revenues.
DOLLAR SLIPS
The dollar fell, losing ground after a G7 ministers meeting
at the weekend brought no surprises, while the Australian dollar
gained as speculation mounted that the country's central bank
could raise rates this week.
The dollar index <.DXY>, a measure of the greenback's
performance against six major currencies, fell 0.2 percent,
while the euro climbed to $1.4622 <EUR=> after ending around
$1.4575 on Friday.
Group of Seven finance ministers and central bankers, who
met in Istanbul at the weekend, broke no new ground on
currencies, urging China to strengthen the yuan to help correct
global imbalances and saying too much forex volatility tended to
threaten economic stability. []
"It was the usual mantra about FX volatility and disorderly
movements in exchange rates which we've seen time and time
again," said Mitul Kotecha, global head of FX strategy at Calyon
in Hong Kong.
Euro xone government bond yields were barley changed.
(Additional reporting by Brian Gorman and Charlotte Cooper,
editing by Mike Peacock)
