* Markets put positive spin on startlingly weak US growth data
* Outlook for low US rates pulls down bond yields, benefits stocks
* Dollar loses ground, gives commodities a lift
By Wayne Cole
SYDNEY, June 26 (Reuters) - Asian shares swung higher on Thursday as weak U.S. growth seemed to further delay the day when interest rates might rise, pulling down bond yields globally and pushing investors toward riskier assets in a desperate search for returns.
A shockingly poor reading on the U.S. economy for the first quarter also pressured the dollar while giving a lift to most commodities and resource-related currencies.
Still, the prospect that Federal Reserve would keep rates low for longer encouraged equity investors. MSCI's broadest index of Asia-Pacific shares outside Japan added 0.3 percent. Japan's Nikkei gained 0.4 percent and South Korea 0.5 percent.
On Wall Street, the Dow bounced 0.29 percent, the S&P 500 0.49 percent and the Nasdaq 0.68 percent.
Shares of CBS shot up 6.2 percent as the U.S. Supreme Court ruled TV startup Aereo violates copyright law by using tiny antennas to provide subscribers with broadcast network content via the Internet.
Markets managed to put a positive spin on data showing the U.S. economy shrank at an annualised 2.9 percent pace in the first quarter, far below already-pessimistic estimates. Analysts emphasised the weakness was mainly due to one-off factors and a marked rebound was likely this quarter.
Yet the result was so poor that it soured the outlook for the entire year, such that the Fed's recently lowered forecast of 2.2 percent growth for 2014 now seems highly optimistic.
That only added to market expectations the Fed would keep rates near zero well into next year and led investors to push out ever further on the yield curve in search of returns.
This trend nudged yields on 10-year Treasuries down to 2.56 percent and away from the June peak of 2.66 percent.
The hunt for yield was even more acute in Europe, where the European Central Bank recently started charging banks for taking their cash deposits.
The tide of money pushed yields on German 10-year debt to a one-year trough of 1.26 percent. That in turn widened the spread against U.S. paper out to 130 basis points, giving Treasuries the biggest premium in at least two decades.
That yield advantage could provide the U.S. dollar some support over time, but for now the sticker shock from the GDP numbers kept the currency under pressure.
The dollar index fell as far as 80.091, a low not seen since May 22, while the euro bounced to $1.3627.
Sterling climbed to $1.6984 from a one-week low of $1.6952, while the Australian dollar popped back above 94 U.S. cents from $0.9354.
The lower dollar helped gold up to $1,318.75 an ounce, from a low of $1,310.36 on Wednesday.
In oil markets, U.S. crude was firmer after news of a government decision to permit exports of lightly refined oil promised to open a new source of demand for the product.
U.S. crude added 18 cents to $106.68 a barrel, while Brent gained 20 cents to $114.20. (Editing by Eric Meijer)