* BoE announces surprise 50 bps cut to tackle coronavirus shock
* Move raises pressure on ECB to act on Thursday
* European shares follow Wall Street higher but rebound small
* Oil falls after Saudi Aramco announces more production
* Graphic: World FX rates in 2020 tmsnrt.rs/2egbfVh
By Tommy Wilkes
LONDON, March 11 (Reuters) - European stocks staged a small rebound on Wednesday after the Bank of England joined other banks in cutting interest rates, raising hopes for more coordinated monetary and fiscal stimulus to counter the economic shock from the coronavirus outbreak.
The surprise move from the BoE which -- on the day that Britain's budget is set to open the taps on spending -- also announced measures to support bank lending, lifted shares after a lacklustre session in Asia.
Wall Street rallied sharply on Tuesday, helping reverse some of Monday's brutal losses, but that failed to translate into improved sentiment on Wednesday as scepticism grew about the stimulus package announced by Washington to fight the epidemic.
By 1100 GMT, however, stocks were off their daily highs as caution set in. The FTSE 100 had risen 0.83%, the Euro Stoxx was 1.39% ahead and Germany's DAX was 1.29% higher.
U.S. stock futures were down 2.04%, although that was up from the 3% losses before the BoE's 50-basis-point cut in the base rate to 0.25%. MSCI's broadest index of Asia-Pacific shares outside Japan weakened 1.12%.
With the Federal Reserve having already cut rates this month, the pressure is now on the European Central Bank to act when it meets on Thursday.
The BoE did not announce new quantitative easing measures but it did launch a new scheme to support lending to small businesses. The UK finance minister is due to present his first annual budget shortly after 1230 GMT.
"It is the only thing central banks can do in a public health crisis," said Neil Dwane, global strategist and portfolio manager at Allianz Global Investors. "They are trying to take the shackles off the banks to ensure we don't get a cash crunch."
But after a decade of extraordinary monetary policy, investors say the impact of easier policy has clear limits and increased government spending must bear the brunt of the policy response to the economic consequences of the outbreak.
"For the ECB their problem is that there is even more pressure because they face the third-largest euro zone economy -- Italy -- in dire straits," Dwane said.
As of Tuesday's close, $8.1 trillion in value has been erased from global stock markets in the recent rout.
The MSCI all-country index has lost more than 15% of its value since it peaked on Feb. 12, and was 0.13% lower on Wednesday.
Sterling initially fell sharply following the BoE decision before rebounding. It was last up 0.4% at $1.2925 but down 0.3% versus the euro at 87.66 pence.
The dollar resumed its decline against the yen, the Swiss franc and the euro, weighed down by uncertainty about the U.S government's response and the drop in U.S. Treasury yields. The greenback remained significantly above levels seen on Monday, however.
Benchmark U.S. 10-year Treasury yields fell 5 basis points to 0.7035%, more than double Monday's record low yield of 0.3180%.
Market participants largely expect the Fed to cut rates for the second time this month at next week's scheduled policy meeting, after it surprised investors with a 50-basis-point cut last week.
German government bond yields rose after the BoE cut supported sentiment, while Italian yields -- which had shot up on worries the country with Europe's worst outbreak of the virus is sliding into a recession -- tumbled 20 basis points as bets on ECB stimulus grow.
Italy is on lockdown in an attempt to slow new infections.
Karen Ward, Chief Market Strategist for EMEA at JP Morgan Asset Management, said all eyes were now on British finance minister Rishi Sunak to see if he announces a big increase in spending.
"If he does, this would be the first instance of a truly coordinated monetary and fiscal push. Investors may be comforted by the fact that policymakers are willing to deploy their full ammunition -- moving a step closer to helicopter money," she said.
A radical argument for fiscal policy to create money and hand it out to the public is sometimes referred to as "helicopter money".
U.S. crude slid 2.5% to $33.49 per barrel, while Brent crude dropped 2.31% to $36.36 after Saudi Aramco announced plans to raise its production capacity at the same time as the coronavirus was set to weaken demand.
On Monday, oil prices plunged as Saudi Arabia and Russia clashed openly over management of supply.
Spot gold rose 1% to $1,665 per ounce as investors sought safety in the precious metal.
Additional reporting by Marc Jones in London; Editing by Catherine Evans