GLOBAL MARKETS-World shares hit fresh all-time highs; earnings and Fed in focus

* Graphic: Global asset performance http://tmsnrt.rs/2yaDPgn
* Graphic: World FX rates http://tmsnrt.rs/2egbfVh
* Reuters Live Markets blog: LIVE/

LONDON, Feb 10 (Reuters) - World shares rose to new all-time
highs overnight and European indexes strengthened, with market
sentiment generally upbeat on the prospect of fiscal stimulus
and vaccine rollouts and ahead of a speech by U.S. Federal
Reserve Chair Jerome Powell.
The MSCI world equity index, which tracks shares in 49
countries, was up 0.2% at 0833 GMT, having touched new peaks
shortly before .MIWD00000PUS .
Overnight, MSCI's ex-Japan Asian shares index also broke
above its previous high hit in January. .MIAPJ0000PUS .
European indexes strengthened after a shaky start, with the
STOXX 600 .STOXX and London's FTSE 100 .FTSE both up 0.2%.
The dollar slipped slightly against a basket of currencies,
down 0.2% at a two-week low of 90.263 =USD .
"The reflation rally continues and interestingly with the
dollar now weakening which suggests inflows into Asia are being
recycled," wrote Sebastien Galy, senior macro strategist at
Nordea Asset Management in an emailed note.
"Eventually, the reflation in commodities will start to
affect real economic activity and create a negative feedback
loop, especially oil," he said.
Oil prices rose overnight but steadied as European markets
opened. Brent LCOc1 has risen for eight days in a row, the longest
sustained run of gains since January 2019, while U.S. oil CLc1
gained for seven days, the longest rally since February 2019.
China's consumer price index fell more than expected, but
factory prices posted their first year-on-year rise in 12
months, suggesting gathering momentum in the industrial sector.
up. Chinese stocks rose to multi-year highs on the last trading
day before the week-long lunar new year holidays "China has been able to recover quickly because it
controlled the pandemic quickly, which enabled it to fill the
gap caused by production bottlenecks in countries where COVID-19
restrictions were still in place," Marcin Adamczyk, head of
emerging markets debt at NN Investment Partners, wrote in a
note.
U.S. President Joe Biden said on Tuesday he agreed with a
proposal by Democratic lawmakers that would limit or phase out
stimulus payments to higher-income individuals as part of his
$1.9 trillion COVID-19 relief bill. The U.S. government will begin shipping COVID-19 vaccines
directly to community health centres next week, as part of
Biden's goal of administering 100 million doses of the vaccine
in his first 100 days in office. Earnings also contributed to market optimism. Japan's Toyota
hiked its full-year earnings forecasts by 54% to a record $19
billion. Societe Generale beat profit forecasts for the fourth
quarter, as did Dutch bank ABN Amro. After a slight pullback on Wall Street on Tuesday, S&P 500
futures pointed towards a stronger open, up 0.3% EScv1 .
U.S. Federal Reserve Chair Jerome Powell will speak in a
webinar about the state of the U.S. labour market at 1900 GMT.
"The Fed's job in avoiding unwarranted moves higher in
yields is about to get more difficult," wrote Derek Halpenny,
MUFG head of research for global markets EMEA, in a note to
clients.
"Tonight's speech will need to be carefully balanced between
an improving outlook due to COVID and continued caution given
the high levels of uncertainty and the long road to achieving
its new, higher inflation goal."
U.S. CPI data is also due later in the session. The 10-year
treasury yield was little changed at 1.1534%, having dipped from
a spike on Monday to its highest since March last year
US10YT=RR .
In Europe, the benchmark 10-year German Bund yield was
steady at -0.445%. Italian borrowing costs hit a one-month low
on Tuesday as Mario Draghi made progress in his attempt to form
a government. The euro was up 0.2% at $1.2137, its highest in 9 days
EUR=EBS .
Elsewhere, Bitcoin was trading around $46,763 BTC=BTSP and
Ethereum hit new record highs ETH= .

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Emerging markets http://tmsnrt.rs/2ihRugV
Global asset performance http://tmsnrt.rs/2yaDPgn
MSCI world stock index cruising at record highs https://tmsnrt.rs/3qaUqvu
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