Hopes of a robust take-up of the European Central Bank's latest offer of cheap loans supported European stock markets on Wednesday, but concerns that the region's debt problems are far from resolved kept the single currency under pressure.

Ireland's surprise decision to hold a referendum on a new budget treaty served as a reminder ahead of the European Union leaders summit later this week that the move toward much needed fiscal integration of the euro zone still faces many hurdles.

But the short term focus is on the ECB tender at which a large number of banks are expected to borrow a total of around 500 billion euros ($671 billion) of three-year money to ease pressure on balance sheets, allowing them to boost lending.

It all depends on the size of the take up. I think the market will be happy with 500 billion euros, the banks have been responding quite well to improving credit conditions and share prices have been highly correlated to it, said Colin McLean, managing director at SVM Asset Management in Edinburgh.

The FTSEurofirst 300 index of top European shares opened up 0.3 percent at 1079.39 points, while MSCI's world equity index was up about 0.3 percent after Asian stocks rose to a seven-month high earlier in the day.

Although a number much above that would indicate banks have more cash available to lend and would likely help shares, a large overshoot could also hint that lenders have more underlying problems than previously thought, upsetting the positive mood. Analysts said any gains for the euro would be short-lived.

Only a take-up of less than 350 billion euros and north of 700 billion euros might see a significant move in risk assets,

Jimmy Yates, head of equities at CMC Markets said.

The euro was slightly lower at $1.3458, just below a near three-month peak of $1.3487 set on Friday, but is on track for a 3 percent gain this month, its best performance since October.


Commodities like copper, gold and silver were all firmer as were commodity currencies such as the Australian dollar.

In the debt markets, Italian 2-year government bond yields fell on hopes some of the ECB money would be used by the bank to fund purchases of higher yielding government bonds.

Two-year Italian yields were 16 basis points lower at 2.32 percent, with 10-year yields 7 basis points lower at 5.29 percent.

Safe haven German government bonds eased due to the positive influence of the ECB tender on other assets. The results of the offer are due to be announced at around 1020 GMT. German Bund futures were 31 ticks lower at 139.75.

Oil prices were also recovering after sharp losses on Tuesday with Brent crude trading at $122.60 a barrel. Oil has risen sharply this year, raising concerns over global economic growth going forward.

($1 = 0.7450 euros)

(Additional reporting by Joanne Frearson; editing by Patrick Graham)