World stocks rose on Wednesday and government bonds and the low-yielding yen fell as forecast-beating earnings from European companies spurred share buying ahead of key U.S. growth data.

French tire maker Michelin rose 6.8 percent after it posted first-quarter sales slightly higher than expected and said it was well on track toward generating positive free cash flow in 2009.

Royal Dutch Shell Plc gained 0.8 percent after outperforming analysts' forecasts, though it reported sharply lower first-quarter profit due to lower crude prices.

Investors were eyeing first-quarter U.S. growth data and the outcome of the Federal Reserve policy meeting, where the central bank is expected to hold its benchmark interest rate at zero to 0.25 percent.

Analysts had been expecting really bad corporate figures, and now some of the results beat forecasts, said David Thebault, head of quantitative sales trading at Global Equities.

But it doesn't mean things are improving. The MSCI world equity index <.MIWD00000PUS> rose 0.6 percent, edging toward a three-month high hit last week, while the FTSEurofirst 300 index <.FTEU3> rose half a percent.

Emerging stocks <.MSCIEF> rose 0.2 percent.

U.S. crude oil rose half a percent to $50.18 a barrel.

The June bund futures fell 57 ticks, as safety-seeking flows waned.

The yen fell 0.3 percent to 96.69 per dollar while the euro rose 0.5 percent to $1.3200.

The dollar <.DXY> fell 0.3 percent against a basket of major currencies.

The Fed has left interest rates at a record low level since December. After its meeting in March, the central bank announced plans to pump an additional $1.15 trillion into the economy by buying mortgage debt and long-dated U.S. Treasuries.

With long-term U.S. treasury yields having retraced to pre-Quantitative Easing levels, there is likely to be some discussion of whether additional non-conventional measures will be required, Barclays said in a note to clients.

The bank said the Fed was unlikely to announce an expansion of its Treasury purchases this month.

The economic data since the March FOMC meeting have been mixed, an improvement from the previously uniformly negative flow of indicators... We think the FOMC statement will suggest that the pace of economic contraction may be easing, although the outlook continues to be subject to more than the usual degree of uncertainty.

(Additional reporting by Blaise Robinson, editing by Stephen Nisbet)