*

Tech shares lead rally on exemptions to U.S. chip tariffs

*

Euro, European shares supported by Ukraine ceasefire

expectations

*

Sterling inches up ahead of Bank of England policy

decision

By Samuel Indyk and Kevin Buckland

LONDON, Aug 7 (Reuters) - Global equities rose on

Thursday, with Japanese shares hitting a record high, as

tech-led gains on Wall Street, upbeat earnings, growing hopes

for a ceasefire in Ukraine and expectations for U.S. rate cuts

boosted sentiment.

Markets largely shook off U.S. President Donald Trump's

latest tariff volleys, including an additional 25% tariff on

U.S. imports from India over purchases of Russian oil and a

threatened 100% duty on chips.

"It's surprising that everything that gets thrown at the

market that it just continues to melt-up," said Eddie Kennedy,

head of bespoke discretionary fund management at Marlborough.

Europe's STOXX 600 rose 0.5%, with major indexes in

Frankfurt and Paris up 1% and 0.8%,

respectively. Britain's FTSE 100 was the outlier,

dropping 0.3%.

Plans for a meeting between U.S. President Donald Trump and

Russian President Vladimir Putin over the war in Ukraine also

helped sentiment in European equities and underpinned the euro.

"It (a ceasefire) would be an extra positive," said Emmanuel

Cau, Barclays head of European equity strategy.

"If there is a de-escalation, it would clearly be

supportive. It's not the key driver but it's definitely been a

lingering issue for Europe."

In Asia, Japan's broad Topix index rose 0.7% to a

record closing high, with the more tech-focused Nikkei

also gaining by about the same.

Taiwan's stock benchmark surged as much as 2.6% to a

more than one-year peak. Shares in chipmaker TSMC,

which this year announced additional investment in its U.S.

production facilities, soared 4.9% to a record high.

The KOSPI added 0.6%, with South Korea's top trade

envoy saying Samsung Electronics ( SSNLF ) and SK Hynix ( HXSCF )

would not be subject to 100% tariffs.

Hong Kong's Hang Seng rose 0.5%, although mainland

Chinese blue chips were only slightly higher on the

day. The yuan firmed slightly to 7.1819 per dollar in offshore

trading.

U.S. S&P 500 futures rose 0.3%. On Wednesday, the

cash index climbed 0.7%.

"Wall Street seems to have gotten its mojo back,"

Capital.com analyst Kyle Rodda wrote in a note.

"However, there are persistent risks to the downside.

Downside surprises in official data are increasing," he

said. "Valuations are also stretched, with forward price to

earnings hovering around the highest in four years. And trade

uncertainty persists."

DOLLAR ON BACK FOOT

The U.S. dollar remained lower against major peers on

Thursday, with expectations of easier policy from the Federal

Reserve stoked both by some disappointing macroeconomic

indicators - not least Friday's payrolls report - and Trump's

move to install new picks on the Fed board that are likely to

share the U.S. President's dovish views on monetary policy.

Focus is centring on Trump's nomination to fill a coming

vacancy on the Fed's Board of Governors and candidates for the

next chair of the central bank, with current Chair Jerome

Powell's tenure due to end in May.

The benchmark 10-year U.S. Treasury yield was

little changed at 4.2365%. The two-year yield, which

is more sensitive to changes in interest rate expectations, was

up 1 basis point at 3.7134%, close to a three-month low of

3.659% touched on Monday.

The dollar index, which gauges the currency against

the euro, sterling and four other counterparts, eased 0.2% to

98.031, extending a 0.6% drop from Wednesday.

The euro added 0.2% to $1.1686, following the

previous session's 0.7% jump.

Sterling rose 0.2% to $1.3378.

The BoE looks poised to cut interest rates for the fifth

time in 12 months later on Thursday, but nagging worries about

inflation are likely to split its policymakers and cloud the

outlook for its next moves.

Two Monetary Policy Committee members may push for a

half-point rate cut, and two may lobby for no change.

In commodities, spot gold added 0.3% to $3,376 an

ounce, after earlier hitting its highest level in two weeks.