* World shares gain as China signals support for growth
* Solid earnings boost U.S. stocks; markets await Apple results
* Copper, oil prices fall on worries over global demand
* Dollar edges up from one-month low on higher U.S. yield
By Richard Leong
NEW YORK, July 23 (Reuters) - World stock prices climbed closer to five-year highs on Tuesday, supported by signs China was moving to avoid a hard landing for its slowing economy, while the dollar hovered at its one-month low as a recent selloff slowed.
Major U.S. equity indexes opened higher on news of solid earnings from chemical maker DuPont and insurer Travelers , though results from tech giant Apple due later in the day could keep a lid on any gains.
Copper and oil prices rebounded from early losses on hopes for good results from China’s economic efforts, while yields on low-risk U.S. and German government debt rose as higher equity prices reduced their safe-haven appeal.
“The stock market is seen as the only real game in town where you can catch returns,” said Andre Bakhos, director of market analytics at Lek Securities in New York.
Stock markets worldwide gained after local media in China reported the government was looking to increase investment in railroad projects as part of efforts aimed at ensuring annual economic growth does not sink below 7 percent.
“Managing to keep (Chinese growth) above 7 percent will certainly be viewed as a positive stance,” said IG Markets analyst Alastair McCaig in London. “But they really have only five months to prove their words are worth their weight.”
The MSCI world equity index climbed 0.26 percent to 376.53, within about 6 points of its five-year high set in May.
In mid-morning trading, the Dow Jones industrial average was up 1.95 points, or 0.01 percent, at 15,547.50. The Standard & Poor’s 500 Index was down 4.12 points, or 0.24 percent, at 1,691.41. The Nasdaq Composite Index was down 17.20 points, or 0.48 percent, at 3,583.19.
Wall Street has moved higher in 11 of the past 12 sessions. The S&P 500 closed at a third straight all-time high on Monday and is up about 20 percent for the year.
Deals in the telecoms sector fed the gains across Europe, lifting the broad FTSE Eurofirst 300 index 0.3 percent to 1,213 after it reached a near seven-week high of 1,216 earlier in the session.
An upgraded economic outlook from Japan’s government lifted Tokyo’s Nikkei stock index 0.82 percent to 14,778.51.
The dollar held near a one-month low against a basket of currencies as investors bet that recent declines were too far, too fast even amid the debate about when the U.S. Federal Reserve would begin to slow its stimulus measures.
Fed Chairman Ben Bernanke’s dovish rhetoric has emphasized that central bank bond buying will continue in some form and U.S. rates are likely to remain low for the foreseeable future.
Heightened expectations that Japan’s government will stick to expansionary policies after weekend elections weakened the dollar against the yen on Monday.
The victory in parliament’s upper house election on Sunday cemented Japanese Prime Minister Shinzo Abe’s hold on power and gave him a stronger mandate for his programs to stimulate the world’s third-biggest economy.
However, a rise in U.S. 10-year Treasury note yields above the 2.50 percent level ahead of this week’s $99 billion in coupon-bearing supply helped the dollar. The benchmark 10-year U.S. Treasury note was down 5/32, the yield at 2.5031 percent.
German 10-year Bund yield, meanwhile, rose about 4 basis points to 1.554 percent.
The dollar index was little changed on the day at 82.210. The greenback was up 0.2 percent against the yen at 99.89 yen after briefly trading back above the 100 yen level, while it was up 0.07 percent versus the euro at $1.3194.
In the commodities market, copper was little changed at $7,029.50 a tonne in London, paring early losses linked to worries about a supply glut and sluggish global demand.
Oil prices rebounded from early lows on optimism about China’s efforts to avert a hard-landing of its economy. Brent oil rose 29 cents or 0.27 percent to $108.44 a barrel, while U.S. crude futures were down 4 cents or 0.04 percent at $106.90 a barrel.
Gold prices fell 0.27 percent to $1,331.41 an ounce as the dollar’s bounce prompted buyers to pause after the metal’s biggest one-day price rise in more than a year on Monday. The precious metal has recovered nearly $160 from a three-year low of $1,180.71 on June 28.