* Asian shares hit 2-month high
* Europe eyes longest winning streak in 5 months
* GDP data a chink of light in gloom
By Jamie McGeever
LONDON, March 2 (Reuters) - World shares and bond yields
rose on Wednesday as the recent recovery in oil prices and a
batch of positive economic data from Australia to the United
States calmed fears of a global economic slowdown.
Asian stocks hit a two-month high, Japan's and China's main
indices both rose more than 4 percent, and European markets were
up for the fifth day in a row, on track for their longest
winning streak in five months.
Investors shrugged off further signs of weakness in global
manufacturing, taking their cue instead from other indicators
pointing to pockets of light amid the recent economic gloom such
as U.S. construction spending, and Australian and Swiss GDP.
"Stocks are trading higher as Australian and Swiss growth
figures came in better than expected. European markets have
opened in the green and U.S. stocks will certainly benefit from
the global risk-on trading," said Ipek Ozkardeskaya, market
strategist at London Capital Group.
In early European trade the FTSEuroFirst index of leading
300 shares was up 0.7 percent at 1,3412 points .FTEU3 , on
track for its fifth straight day of gains.
FTSE 100 .FTSE was up 0.6 percent, Germany's DAX .GDAXI
up by 1 percent, with France's CAC .FCHI up 0.8 percent.
Investors also continued to take heart from announcements
from China earlier this week of a cut in bank reserve
requirements and structural reforms to the world's economic
growth engine.
Japan's Nikkei .N225 was up 4 percent, Hong Kong's Hang
Seng Index .HSI rose 3 percent and China's main bourses had
their best day so far this year, rising more than 4 percent
.SSEC .CSI300 .
MSCI's broadest index of Asia-Pacific shares outside Japan
.MIAPJ0000PUS rose 2.4 percent to its highest levels since
Jan. 7, and building on gains in the previous session.
MSCI's broadest gauge of the world's stock markets
.MIWD00000PUS also rose to highest level in almost two months.
STIMULUS HOPES
The Institute for Supply Management's (ISM) index of U.S.
factory activity, a closely watched measure of the American
manufacturing sector, rose more than expected last month. It
also edged up for two months in a row, appearing to have snapped
its almost continuous decline since late 2014.
U.S. construction spending rose to the highest level since
October 2007 while solid GDP data from Canada and Australia and
Switzerland on Wednesday helped.
The data helped lift the U.S. S&P 500 Index .SPX 2.39
percent to an eight-week high of 1,978.35. Stock futures pointed
to a broadly flat open on Wall Street.
It also lifted expectations of a U.S. rate increase this
year with interest rate futures 0#FF: effectively pricing in a
full chance of a rate hike this year.
Even Moody's downgrade of its outlook on Chinese government
debt to "negative" from "stable" failed to puncture the renewed
sense of cautious optimism.
If anything, investors are taking heart from the prospect of
more stimulus from Beijing in the coming weeks, as well as the
European Central Bank as early as next week.
"The countdown to the ECB meeting begins and the poor
inflation and core inflation numbers from the euro zone points
to more easing from (ECB president) Mario Draghi," said David
Madden, market analyst at IG in London.
Investors unwound bets in safe-haven assets such as
government bonds, with the 10-year U.S. Treasuries yield
US10YT=RR rising to a two-week high of 1.84 percent.
The 10-year German Bund yield rose nearly 4 basis points to
0.187 percent EU10YT=RR , and Britain's 10-year gilt yield rose
5 basis points to 1.44 percent GB10YT=RR .
Gold slipped from its recent high to $1,230 an ounce XAU=
but is still up 16 percent so far this year. Similarly, oil
eased back a little on Wednesday but is till up more than 30
percent from its lows struck just three weeks ago.
Brent crude futures LCOc1 slipped 0.3 percent to $36.70 a
barrel, after hitting an eight-week high of $37.25 on Tuesday,
and U.S. crude futures CLc1 were down 1 percent at $33.98 a
barrel after hitting a one-month high of $34.76 on Tuesday.
The dollar rose to 114.35 yen JPY= , recovering further
from its double-bottom near 111 hit last month, and the euro
EUR= was steady near Tuesday's one-month low of $1.08340,
staying under pressure as investors expect the ECB to step up
monetary stimulus at its policy meeting next week.
Market players were also keeping an eye on U.S. 'Super
Tuesday', where Republican Donald Trump and Democrat Hillary
Clinton took big steps toward securing their parties'
presidential nominations.
Shanghai CSI 300 and global effects interactive https://t.co/YqIYLIbInP
Chinese A-shares vs developed and emerging stocks http://link.reuters.com/rac25w
^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>