GLOBAL MARKETS-Earnings boost world stocks, euro up on data

* Euro hit 12-week high on data, month-end buying

* Earnings, initial claims provide support to equities

* Treasuries sloppy with 10-year yield at 3 pct (Recasts lead; changes byline, dateline, previous LONDON)

By Jennifer Ablan and Dominic Lau

NEW YORK/LONDON, July 29 (Reuters) - Robust quarterly earnings from U.S. and European companies drove up world stocks early Thursday, while the euro hit a 12-week high against the dollar on better-than-expected economic data in Europe.

Optimism about a sustained economic recovery grew following results from Exxon Mobil Corp (XOM.N), Rolls Royce Plc (RR.L) and BAE Systems Plc (BAES.L), against the backdrop of improving economic figures.

A jump in euro zone economic sentiment to a 28-month high and a decline in German unemployment supported the euro's gains. For details, see [ID:nLDE66S0VN] and [ID:nLDE66S0PL]

For its part, U.S. initial jobless claims dropped by 11,000 to a seasonally adjusted 457,000 in the latest week, versus the forecast of 459,000, the government said. [ID:nN28202832]

Global equities measured by the MSCI All-Country World Index .MIWD00000PUS added 0.41 percent, and the Thomson Reuters global stock index .TRXFLDGLPU put on 0.47 percent.

"Second-quarter results are better than expected, and it supports the market," said Emmanuel Morano, head of equity management at fund management firm UFG-LFP in Paris.

He added: "The big question is, is this a pause in the economic recovery or are we heading for a brutal landing? The bond market seems to be pricing in the pessimistic scenario, while equities send a more optimistic signal. Who's wrong? Tomorrow's U.S. GDP figure should shed light on this."

The Dow Jones industrial average .DJI was up 23.31 points, or 0.22 percent, at 10,521.19. The benchmark Standard & Poor's 500 Index .SPX added 1.52 points, or 0.14 percent, at 1,107.65. The Nasdaq Composite Index .IXIC was down 2.64 points, or 0.12 percent, at 2,261.92.

The pan-European FTSEurofirst 300 .FTEU3 advanced 0.15 percent, helped by improving the euro zone sentiment. But Tokyo's Nikkei average .N225 ended down 0.6 percent after hitting a two-week closing high the previous session.

'EUROPEAN RESILIENCE'

All told, U.S. economic data have shown pockets of softening. Wednesday's weak U.S. durable goods figures added to concerns about the outlook for the world's largest economy.

The Fed's Beige Book, a summary of national economic conditions, also showed activity was not as robust in a few districts and lost steam in recent weeks.

California's declaration of a state of emergency over its finances also hurt the dollar.

In New York trading, the dollar was down against a basket of major trading-partner currencies, with the U.S. Dollar Index .DXY off 0.74 percent at 81.57 from a previous session close of 82.179.

The euro EUR= advanced 0.75 percent at $1.309 from a previous session close of $1.2992. Against the Japanese yen, the dollar JPY= was down 0.42 percent at 87.02 from a previous session close of 87.390.

"Economic resilience in Europe, particularly in Germany, despite the formidable sovereign credit headwinds, continues to fuel an unwinding of bets against the euro and push it higher across the board," said Omer Esiner, chief market analyst at Commonwealth Foreign Exchange in Washington, D.C.

U.S. Treasury debt prices were mixed.

The benchmark 10-year U.S. Treasury note US10YT=RR was down 2/32, with the yield at 3.00 percent. The 2-year U.S. Treasury note US2YT=RR was up 1/32, with the yield at 0.6053 percent. At the longer end of the curve, the 30-year U.S. Treasury bond US30YT=RR fell 28/32, with the yield at 4.122 percent.

In energy and commodities prices, U.S. light sweet crude oil CLc1 rose $1.21, or 1.57 percent, to $78.20 per barrel, and spot gold prices XAU= rose $1.45, or 0.12 percent, to $1164.50.

The Reuters/Jefferies CRB Index .CRB was up 3.57 points, or 1.34 percent, at 269.73. (Additional reporting by Vivianne Rodrigues in New York and Blaise Robinson, Naomi Tajitsu and Will James in London; editing by Jeffrey Benkoe)