By Marc Jones
LONDON (Reuters) - European markets rode a global rebound in risk appetite on Tuesday, helped by the first signs of cooperation from Ukraine's pro-Russian separatists over the downed Malaysian Airlines plane.
After days of uncertainty, a train carrying the remains of some of the almost 300 victims arrived in Ukrainian government territory and separatist leaders have handed Malaysian authorities the aircraft's flight recorders.
That helped settle market nerves, lifting shares both in Europe and Asia and pushing back many of the safe-haven assets like the yen, gold and government bonds that have been in demand over the last week.
Europe's FTSEurofirst 300 index climbed 1 percent as the main bourses in London, Frankfurt and Paris all made ground and dollar-traded stocks in Moscow saw their first rise in almost two weeks.
Wall Street futures pointed to U.S. markets starting up around 0.3 percent and the rouble also firmed, trading 0.6 percent stronger against the dollar at 34.90 and almost 1 percent on the euro at 47.10.
"The separatists have reportedly met several of the key demands coming from Malaysia and Western countries," Sberbank Investment Research analysts said.
The rebound in risk was also helped by more solid U.S. company earnings and merger activity in the previous session, though analysts remained wary about Ukraine and Russia given the delicate nature of events.
EU foreign ministers gather later in the day in Brussels to discuss the situation and possibly recommend further sanctions against Russia.
Russia's Security Council, headed by President Vladimir Putin, is also due to meet in Moscow.
RUPIAH WOBBLE
But with the market mood clearly more upbeat for the time being, the dollar hit a six-week high as gold dipped about two dollars to $1,305 an ounce.
In Asian trading, MSCI's broadest index of Asia-Pacific shares outside Japan rose about 0.75 percent to reach its highest since 2011 as shares in China saw their biggest gain in 2-1/2 months.
Most Asian currencies also climbed on the updraft.
Thailand's baht hit an eight-month high on hopes an interim constitution planned by the military will stabilize the country.
Indonesia's rupiah wobbled though as the likely loser in its presidential election, former general Prabowo Subianto, denounced the vote as undemocratic, creating confusion about the official results. [EMRG/FRX]
Intense fighting in the Gaza Strip has also unsettled investors in recent days, but international efforts to end the conflict gathered pace, with U.S. Secretary of State John Kerry holding talks in Egypt and U.N. Secretary General Ban Ki-moon due to arrive in Israel later in the day.
However, there was no sign of any let-up in the fighting around Gaza, with plumes of black smoke spiraling into the sky, and Israeli shells raining down on the coastal enclave.
U.S. DATA
The various pockets of geopolitical uncertainty left the yield on the benchmark 10-year U.S. Treasury - the traditional go-to asset in times of tension - at 2.483 percent in European trading, not far from its year low of 2.4 percent.
Yields on 30-year Treasuries inched down to 3.263 percent from a U.S. close at 3.264 percent on Monday.
Investors were also awaiting U.S. consumer prices data due at 1230 GMT for clues to the timing of any monetary tightening by the Federal Reserve.
The Labor Department is expected to report that U.S. inflation eased slightly to 0.3 percent in June, after rising food prices pushed the index to its biggest increase in more than a year in May.
"It will be interesting to see how euro dollar trades into the CPI numbers," Saxo Bank head of FX strategy, John Hardy, said.
"If it's higher than expected, is it dollar positive on the view that it pulls the Fed guidance forward on the first rate hike? Or is dollar negative because the Fed is seen being complacent on inflation and behind the curve?" he said.
The dollar rose to a six-week high against a basket of major currencies ahead of the data, pushing the euro firmly back under $1.35 in the process, as worries about nearby Ukraine and Russia also weighed on the shared currency. [FRX]
(Additional reporting by Lidia Kelly in Moscow and Lisa Twaronite in Tokyo; Editing by Louise Ireland)