Global stocks hit 2-week highs

LONDON (Reuters) - Global stocks powered to their highest level in nearly two weeks on Wednesday after blockbuster results from major firms including tech bellwether Intel Corp (INTC.O) boosted appetite for riskier assets.

Wall Street looked set to open higher, particularly the tech-heavy Nasdaq .IXIC, with futures rising nearly 2 percent. Intel shares surged 7.8 percent in Frankfurt (INTC.F).

Goldman Sachs (GS.N) and Intel posted solid results on Tuesday while Johnson & Johnson (JNJ.N) beat analysts' forecasts with a 5 percent fall in second-quarter earnings, getting the U.S. earnings season off to a bright start.

That also helped lift U.S. crude oil above $60 a barrel and drive copper to a one-month high of $5,219 a tonne, but the dollar and less risky assets such as government bonds took a beating.

Investors and policymakers are anxiously looking for signs of a pick up in U.S. demand, which is crucial to a solid global recovery.

World stocks as measured by MSCI rose 1.1 percent to 242.49, having earlier touched 242.62 -- a level last seen on July 2 -- and the emerging markets sector index .MSCIEF jumped more than 2 percent to one-week highs.

Markets are now up more than 6 percent for the year, but have struggled to break out of a fairly tight range since mid-June.

In Europe, the FTSEurofirst 300 index of top regional shares was up 1.6 percent, rising for a third day running. London's FTSE 100 index .FTSE also advanced 1.6 percent.

Even data showing the British unemployment rate hitting 7.6 percent in the three months to May -- the highest since January 1997 -- failed to dampen optimism among equity players.

"The market is prepared to shake off weak economic data, preferring to focus on consensus-breaking results and upbeat outlooks from corporates," said Henk Potts, equity strategist at Barclays Stockbrokers.

"There are some longer-term factors to take into account, but certainly in the short term the direction of the markets will be determined by the percentage of companies that either meet or exceed analysts' expectations."

In Asia, Japan's Nikkei average .N225 edged up 0.1 percent, but shares elsewhere in the region .MIAPJ0000PUS rallied 2.9 percent.

DOLLAR/BONDS PRESSURED

The dollar fell to a two-week low against a basket of currencies as investors sought higher-yielding units such as the Australian dollar.

The yen also struggled while the euro gained, boosted by higher European shares. The euro brushed off a 0.1 percent annual fall in euro zone inflation, which confirmed that price risks in the region are nil at the moment.

The dollar index .DXY slipped 0.7 percent, while the euro gained 0.7 percent to $1.4070. Against the dollar, the Australian currency rose 0.6 percent to $0.7995.

"The market may be expecting more pleasant surprises rather than unpleasant surprises from earnings," said Steve Barrow, head of G10 currency research at Standard Bank in London.

Against the backdrop of better risk appetite, investors gave lower risk government bonds a wide berth, sending the euro zone's benchmark yield up to a two-week high just above 3.35 percent. Yields trade inversely to bond prices.

U.S. Treasury prices resumed their decline, pushing the 10-year yield to a one-week high around 3.49 percent.

(Additional reporting by Atul Prakash and Tamawa Desai; Editing by Patrick Graham)