*

European stock indices climb over 1%

*

Hong Kong stocks fall 1.5% after Beijing's stimulus

disappoints

*

Bitcoin hits record high amid lighter regulations

expectations

*

Dollar steady ahead of key U.S. inflation data and Fed

speakers

(Recasts lead for European open, adds quote in paragraph XX,

updates prices throughout)

By Nell Mackenzie and Kevin Buckland

LONDON/TOKYO, Nov 11 (Reuters) - European stocks rallied

sharply on Monday ahead of a busy week, while Hong Kong stocks

led declines in Asia after Beijing's latest stimulus fell short

of investor expectations and bitcoin raced to another record

high.

European shares climbed over 1%, with most sectors rising,

kicking off a week packed with global economic data, including

inflation readings in Germany and the United States.

The pan-European STOXX 600 added 1% as of 0959 GMT,

with industrials among the top gainers, up 1.4%.

"We don't see a huge amount in future potential return from

Europe," said Matt Tickle, chief investment officer at

consultancy Barnett Waddingham.

He said their general investment outlook remained sceptical

on European growth prospects, even with Monday's rally.

The euro slipped to its lowest since the end of

June at $1.0679, last down 0.4% $1.0671, pushed down by reports

that former U.S. Trade Representative Robert Lighthizer, known

to be hawkish on tariffs, was to join the new Trump

administration.

Reuters reported on Friday that Lighthizer had not yet been

asked by Trump's new administration to join the role.

Trump's victory and pro-crypto candidates being voted to

Congress has pushed bitcoin to a new all-time high, spurred on

by expectations of a lighter regulatory environment.

The dollar traded not far from last week's four-month peak

versus major peers as traders prepared for a key reading of U.S.

consumer inflation this week, as well as a parade of Federal

Reserve speakers, including Chair Jerome Powell on Thursday.

S&P 500 futures pointed 0.3% higher on Monday.

The Republican party is edging closer to sweeping both

chambers of Congress, taking the Senate on election night and

with Edison Research projecting it so far to have 214 seats of

218 needed for control of the House, compared to 205 for

Democrats.

Investors expect Trump's second term in office will bring

equities-boosting tax cuts and looser regulations.

Traders will be watching consumer price data on Wednesday

for stickiness that could scupper the chances of an interest

rate cut at the next meeting in December.

Markets currently lay about 65% odds for a quarter-point

reduction on Dec. 18, according to CME Group's FedWatch Tool.

DIVERGING FORTUNES

Hong Kong shares slipped to a three-week low on Monday as

China's local government debt-relief package fell short of

investors' expectations for economic support, while a rally in

semiconductor stocks pulled Chinese markets slightly higher.

China's blue-chip CSI300 Index closed 0.6% higher,

led by a 6.8% jump in semiconductor stocks after Reuters

reported the U.S. had ordered chipmaking giant TSMC to

halt shipments of advanced chips to Chinese customers.

Investors figured that would encourage authorities to

support China's industry and bought shares in local makers,

sending Semiconductor Manufacturing International Corp

stock up 4.7% to a record high.

Japan's Nikkei closed up 0.08% as gains were capped

by domestic firms' dim outlook forecasts.

On Friday, after Chinese markets were closed, the National

People's Congress Standing Committee unveiled a 10 trillion yuan

($1.39 trillion) debt package to ease local government financing

strains and stabilise flagging economic growth.

However, the stimulus steps lacked the direct injection of

money into the economy that some investors had hoped to see,

particularly amid the threat of massive tariffs under the

incoming Trump administration.

Gold declined 0.7% to $2,666.10 per ounce, dropping

back further from last month's record high of $2,790.15.

Oil prices extended declines from Friday on the expectation

that Trumps pro-drilling rhetoric will increase world supplies.

Brent futures dropped 71 cents to $73.16 a barrel,

while U.S. WTI futures fell 83 cents to $69.55 a barrel.

($1 = 7.1787 Chinese yuan renminbi)