GLOBAL MARKETS-World stocks up, Treasuries recover from sell-off

* Stocks gain in run-up to year-end

* Treasuries recover some losses after sell-off

* Dollar slightly weaker against basket

By Jeremy Gaunt, European Investment Correspondent

LONDON, Dec 29 (BestGrowthStock) – World stocks were close to fresh
27-month highs on Wednesday as investors headed towards the new
year buoyed by hopes of a global growth spurt in 2011.

U.S. Treasuries steadied after yields jumped overnight
following dismal demand at an auction of five-year notes. The
dollar was about a fifth of a percent lower against a basket of
major currencies (.DXY: ).

A weaker dollar lifted demand for commodities, and London
Metal Exchange copper (CMCU3: ) rose to a record $9,437.50 a tonne
before easing back, with the metal boosted also by a stoppage at
a key port in major producer Chile. [MET/L]

Moves by China to slash export quotas on the rare earths
minerals used in high tech and automotive manufacture had no
impact on listed metals prices, traders said.

Wall Street looked set to open with gains.

Investors are finishing up 2010 with a rally in riskier
assets, persuaded that the world economy is on the mend and that
the cost of many safe-haven assets such as benchmark government
bonds is too high for the potential returns.

A Reuters graphic — http://r.reuters.com/veq33r — shows
copper, gold and the U.S. over-the-counter Nasdaq index (.IXIC: )
to be the big winners this year.

Much of the stock market gains, however, came after Federal
Reserve Chairman Ben Bernanke made clear in August that the Fed
was willing to buy more assets in order to pump liquidity into
the then-slowing U.S. economy.

“The one thing the market has got going for it is the U.S.
economy regaining momentum. At the moment the market doesn’t
want to know the bad news — and it’s very reluctant to give up
any ground whatsoever,” said Mike Lenhoff, chief strategist at
Brewin Dolphin Securities, in London.

MSCI’s all-country world stock index (.MIWD00000PUS: ) was up
a fifth of a percent, just shy of a new 2010 high that would
take it to levels last seen in early September 2008.

The index’s emerging market counterpart (.MSCIEF: ) was up two
thirds of a percent. It is up more than 16.6 percent this year.

In Europe, the FTSEurofirst 300 (.FTEU3: ) was up 0.2 percent.
Earlier, Japan’s Nikkei (.N225: ) gained 0.5 percent.

TREASURIES IN FOCUS

U.S. Treasuries recovered some losses after prices fell
broadly on Tuesday in the aftermath of a poor auction of 5-year
notes.

U.S. bond yields have soared this month on expectations that
2011 will see accelerating economic growth, while concerns over
the U.S. deficit have also weighed on the debt.

The 10-year U.S. Treasury was yielding 3.44 percent, down 5
basis points.
There was some weakness in euro zone government debt linked
to the overnight Treasury sell-off.

The dollar slipped against a basket of major currencies
after stabilising somewhat, with the U.S. Treasury auction and
weak U.S. consumer confidence weighing.

The market remained very thin, however, and susceptible to
exaggerated moves.

(Additional reporting byBrian Gorman; graphic by Scott
Barber)

GLOBAL MARKETS-World stocks up, Treasuries recover from sell-off