*

Treasuries hold onto Wednesday's inflation data inspired

gains

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Richemont leads European stocks higher after results

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Asian stocks surge, boosted by tech sector after TSMC

results

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Yen hits strongest in a month on growing rate hike wagers

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US earnings kick off with strong showing by banks

(Updates after early European trading)

By Ankur Banerjee and Alun John

SINGAPORE/LONDON, Jan 16 (Reuters) - Stocks surged on

Thursday, extending momentum from the previous session when data

showed an easing in core U.S. inflation that raised expectations

for Federal Reserve cuts and sent global bond yields lower.

Strong results from blue-chip companies across the world

added fuel to the equities rally, and supported risk sentiment

across a range of asset classes.

Richemont, the owner of Cartier jewellery, jumped

17%, putting it on track for its best day in 17 years, after its

results exceeded analyst expectations, driving up the wider

European luxury sector.

Earlier in the day, chipmaker Taiwan Semiconductor

Manufacturing Co ( TSM ), reported record quarterly profit -

albeit in line with expectations - and rose 3.7%, offering

support to other chip firms. Overnight JPMorgan ( JPM )

, BlackRock ( BLK ) and Goldman Sachs ( GS ) delivered

robust earnings.

That all left Europe's STOXX 600 up 0.65% at its

highest in a month and within 2% of September's record.

Asia ex-Japan shares gained 1.33%, while on

Wall Street on Wednesday all three major indexes registered

their biggest daily percentage gains since Nov. 6 - the day

after the U.S. presidential election.

INFLATION RELIEF

Earnings aside, the rally in risk assets stemmed from

Wednesday's benign U.S. inflation report that showed the

consumer price index rose in line with expectations at an annual

rate of 2.9% in December, while core inflation, which excludes

food and energy prices, rose by 3.2%, below forecasts for 3.3%.

The inflation report led traders to price in a 50% chance of

a second 25 basis point Fed rate cut this year. Before the data,

expectations had mounted the Fed might not cut again this year.

Markets gave the data greater credence because other

releases painted a similar picture. Numbers released on Tuesday

showed U.S. producer prices had increased moderately in

December. Wednesday's softer British inflation print also

offered support.

"Wherever you were around the world yesterday, I'm sure you

could hear the huge collective sigh of relief from financial

markets as downside inflation surprises from the U.S. and the

U.K. allowed us to step back from the recent one-way trade on

inflation and bond yields," said Jim Reid global head of macro

research at Deutsche Bank in a morning note to clients.

The benchmark 10-year Treasury yield fell 13.5 basis points

in the aftermath of the data, its biggest daily fall since mid

November. It was steady on Thursday at 4.66%, having

nudged above 4.8% at the start of the week.

Moves were even larger in Britain, whose government bonds

have been some of the biggest victims of the recent global

selloff. The 10-year gilt yield fell 15 bps Wednesday, its most

since late 2023.

YEN AND POUND

The data also offered some support to other currencies

against the dollar.

On Thursday, Japan's yen hit its strongest in

nearly a month on the dollar and euro after comments from

Governor Kazuo Ueda prompted traders to price in a more than 70%

chance the Bank of Japan will raise interest rates next week.

The dollar was last down 0.4% on the Japanese currency at

155.8 yen. The euro eased by a similar amount at 160.

Other currencies were quiet, but the pound dropped 0.3% on

both the dollar and euro after British GDP rose just 0.1% in

December, below expectations.

In energy markets, Brent crude futures slipped 0.2%

to $81.88 a barrel, as investors processed the complex ceasefire

accord between Israel and militant group Hamas.

Spot gold hit a one month high of $2,704.9 per ounce

after the shift in interest rate expectations.