* MSCI world equity index up 0.5 pct at 262.83
* World stocks at 9-mth peak; emerging stocks at 10-mth high
* Oil rallies; dollar, government bonds fall
By Natsuko Waki
LONDON, July 27 (Reuters) - World stocks raced to fresh
nine-month highs and oil rallied on Monday as a recent run of
strong corporate earnings and anticipation for more boosted
optimism for a recovery in the global economy.
Tokyo stocks posted its longest winning streak in 21 years
while emerging Asian stocks <.MIAPJ0000PUS> hit a 10-month high,
following strong gains in most of Wall Street indexes on Friday.
This week's results include Exxon Mobil <XOM>, Honda Motor
<7267.T>, Motorola <MOT>, Deutsche Bank <DBKGn.DE> and BP
<BP.L>.
"Risk appetite (is) quite healthy, there is lower volatility
in stock markets... which continue to register gains," said
Patrick Jacq, euro zone interest rate strategist at BNP Paribas
in Paris.
"If these earnings are in line or above expectations we can
see risk appetite continue to be in the driving seat."
MSCI world equity index <.MIWD00000PUS> rose half a percent,
hitting levels not seen since October, adding to gains over 4
percent last week.
The FTSEurofirst 300 index <> rose 0.6 percent with
basic resource shares leading the rally.
Emerging stocks <.MSCIEF> hit a fresh 10-month high.
According to Thomson Reuters data, the second-quarter
earnings growth rate for the U.S. benchmark S&P 500 index <.SPX>
improved to -31.0 percent last week from -35.2 percent in the
previous week, thanks in part to better-than-expected earnings
from financial sector firms.
Of the 184 companies in the S&P 500 index that have reported
earnings to date for the Q2, 77 percent have beaten
expectations.
The materials, energy, industrial sectors are anticipating
the lowest earnings growth rates for the quarter.
This week. a further 146 S&P 500 companies are due to
announce earnings results.
U.S. crude oil <CLc1> rose more than 1 percent to $68.74 a
barrel.
The September bund futures <FGBLc1> fell 22 ticks as
investors sought riskier instruments over safe-haven government
bonds.
The dollar <.DXY> fell 0.17 percent against a basket of
major currencies. Against the yen it rose 0.2 percent to 94.98
per dollar <JPY=>.
Investors are awaiting the outcome of a two-day meeting of
top U.S. and Chinese officials in Washington, which started on
Monday, on a broad range of economic, security, diplomatic,
energy and environmental issues.
The United States, which ran a record $266 billion trade
deficit with China in 2008, is seeking ways to rebalance trade,
including persuading the Chinese to liberalise exchange rates so
that the yuan appreciates to trim Chinese exports and boost
imports.
"Any remarks from China related to its stance on its U.S.
Treasury holdings and the dollar's role is a focus," a trader at
a Japanese bank said.
(Additional reporting by Emelia Sithole-Materise and Kirsten
Donovan; Editing by Andy Bruce)
