* World shares rise as Alcoa points to solid global demand
* Dollar gains versus yen on expectations of BOJ easing
* Oil slips before Chinese trade data due Thursday
LONDON, Jan 9 (Reuters) - World shares staged a modest recovery from two days of losses on Wednesday after aluminium giant Alcoa opened the U.S. earnings season with an optimistic outlook for global demand.
However, investors were in a cautious mood before European and British central banks hold policy meetings on Thursday, when Spain also tests appetite for peripheral euro zone debt and China releases trade data.
Alcoa, the largest aluminium producer in the United States, rose 1.3 percent in after-hours trade after it reported a fourth-quarter profit in line with Wall Street expectations and revenues that beat forecasts.
The results lifted Asian stocks and pushed Europe's FTSE Eurofirst 300 index up around 0.2 percent, leaving the MSCI world equity index with a gain of 0.1 percent. London's FTSE 100, Paris's CAC-40 and Frankfurt's DAX were flat to 0.3 percent higher.
U.S. stock index futures suggested a small gain on Wall Street as well when it opens.
Corporate profits for the fourth quarter are generally expected to be higher than in the lacklustre previous three months, but analysts' estimates are down sharply from where they were in October.
"Expectations are quite low going into the earnings season as we saw a lot of downward guidance in the past few months. There is potential for an upside surprise to come through," said Robert Parkes, equity strategist at HSBC Securities.
Investors also remain worried about the effect on corporate performance of congressional negotiations over the U.S. budget deficit and looming discussions on raising the government's debt ceiling, which could hurt its credit rating.
DEBT DEMAND SURGE
In the fixed income market German government bond prices gained following a successful auction of new five-year debt, which continued a trend of strong sales in Europe this week with Austria, the Netherlands and Ireland all tapping the market.
Orders for a new 10-year bond from Belgium also reached 4.5 billion euros ($5.9 billion), according to a bank managing the deal, as investors searching for better returns overwhelm the available supply.
But a big test for the market looms on Thursday when Spain and Italy hold their first debt sales of the year, revealing the depth of demand for peripheral euro zone debt.
The Spanish auction could also offer clues on the timing of a much-anticipated request by the government for international financial aid.
Surging demand for high grade corporate debt in the United States has put the new issue market on course for a record week. Thomson Reuters IFR said new issue volume totalled a massive $33 billion by the end of Tuesday, and only $7.6 billion more was needed to match the previous weekly record of $40.6 billion.
The dollar climbed against the yen, moving back towards a 2-1/2 year high hit last week, on expectations of a much bolder monetary easing from the Bank of Japan at its next meeting later this month.
The U.S. currency was up 0.5 percent at 87.47 yen, above a near one-week low of 86.82 hit earlier in Tokyo.
"No one is going to want to be short yen going into the BOJ meeting," said Derek Halpenny, European head of FX research at Bank of Tokyo-Mitsubishi.
Sources familiar with the BOJ's thinking told Reuters the central bank was likely to adopt a 2 percent inflation target at the meeting, double its current goal, and issue a statement with the government promising to pursue bold monetary easing steps.
The euro was slightly lower at $1.3050, easing after German industrial output rose less than expected in November.
The data was unlikely to change the ECB's thinking, with most analysts expecting its Governing Council to keep interest rates on hold on Thursday, though some believe rates will be cut later this year.
CHINA DEMAND EYED
Brent crude oil slipped around 0.15 percent to below $112 per barrel as the market awaited the trade data from China, the world's biggest energy consumer, and the outcome of the ECB meeting.
"What we're seeing in the oil markets is the cautious sentiment playing up ahead of some key economic events this week," said Ker Chung Yang, senior investment analyst at Phillips Futures in Singapore.
However, iron ore jumped to its highest level since October 2011, stretching a rally that has lifted prices by more than a third since December as China replenished stockpiles while supply in the spot market remained limited.
Iron ore, a raw material used to make steel, has now risen 83 percent since falling to below $87 a tonne in September.