World stocks climbed to a new 2009 high on Monday with banking news from Europe generally positive and signs of a pick up in Chinese economic activity lifting Asian shares.

The dollar recovered slightly from early lows against a basket of major currencies <.DXY> but was close to a 2009 trough.

European shares rose after UBS appeared to have settled a tax dispute without the need to pay a fine and with investors digesting results from Barclays .

The FTSEurofirst 300 <.FTEU3> index of top European shares was up 0.7 percent and has now gained more than 44 percent from its lifetime low on March 9.

Barclays reported an 8 percent rise in half-year profit but bad debts almost doubled.

UBS shares rose 4.1 percent on reports it may not have be fined as part a settlement with the U.S. Government on wealthy Americans suspected of using the Swiss bank to evade taxes.

Asian stocks crawled up to an 11-month high, helped by Chinese shares.

Two surveys showed Chinese factory growth accelerating in July thanks to a revived domestic economy and slight pick-up in demand for its exports. The China purchasing managers index from brokerage CLSA hit a one-year high.

The MSCI index of Asia-Pacific stocks outside Japan rose 0.9 percent to the highest levels since early September last year, taking gains on the year to 47 percent.

Globally, the MSCI all-country world share index was up 0.6 percent, eclipsing its previous high for the year which was reached on Friday. This has in part been fueled by upbeat company results, particularly on Wall Street.

All in all, given the better than expected corporate results, the markets continue to support the idea of an imminent recovery, wealth manager BSI said in a note, adding that risk appetite was growing as more investors fear missing the rally.


The dollar hovered near its lowest point this year against a basket of currencies after higher oil prices, firm global stock markets and U.S. GDP data boosted investments in riskier assets.

In early Asian trade, the greenback hit its lowest level since December against the currency basket. It later recovered slightly.

Ahead of many events this week such as economic data in the U.S. and earnings from major companies in Europe and Japan, investors largely stayed on the sidelines, said Yuji Saito, head of the forex sales department at Societe Generale.

As long as the market will be able to cope with those economic events, it will likely keep its risk-taking stance, he said.

The euro reversed earlier gains to a two-month peak against the dollar in choppy trade and was at $1.4222.

Euro zone government bond yields nudged higher.

The 10-year Bund yield was at 3.296 percent, 1.6 basis points more than in late Friday trade while Schatz yielded 1.285 percent.

(Editing by Mike Peacock)

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