(Adds analyst comment in paragraphs 6-7, updates prices at

11:21 a.m. ET (1521 GMT))

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FTSE hits record high as BoE edges toward cut

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European shares also hit new peaks

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U.S. jobless claims rise more than expected

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Graphic: World FX rates http://tmsnrt.rs/2egbfVh

By Herbert Lash and Marc Jones

NEW YORK/LONDON, May 9 (Reuters) - World stocks edged

higher on Thursday, helped by surging European stocks and a

larger-than-expected rise in U.S. weekly jobless claims that

buoyed interest rate cut hopes, while the dollar eased as the

market awaits key inflation data next week.

The pan-European STOXX 600 and Britain's FTSE 100

scaled fresh record highs, last up 0.24% and 0.36%

respectively after the Bank of England kept rates unchanged.

But investors cheered indications more policymakers are

warming to cutting rates soon. Two of BoE's nine rate setters,

one more than in April, voted for a cut and Governor Andrew

Bailey said more could be on the way than investors expect.

The BoE sent a message that bets on the first cut being in

August might be too conservative as it lowered its inflation

forecasts for two and three years' time to 1.9% and 1.6% - below

its 2% target - from its February projections of 2.3% and 1.9%.

In the United States, initial claims for state unemployment

benefits increased 22,000 to a seasonally adjusted 231,000 for

the week ended May 4, the Labor Department said.

"It's a relatively quiet week, but initial jobless claims

came in weaker. We're still clearly in that 'bad news is good

news' macro regime," said Matt Miskin, co-chief investment

strategist at John Hancock Investment Management in Boston.

"We'll have to see if that's the beginning of a trend. That is

one of the biggest jumps we've seen in quite a while."

MSCI's gauge of stocks across the globe rose

0.30%. On Wall Street, the Dow Jones Industrial Average

rose 0.46%, the S&P 500 gained 0.35% and the Nasdaq

Composite gained 0.27%.

The dollar index, a measure of the U.S. currency

against a basket of six others, including the yen and the euro,

fell 0.22% to 105.28. The euro rose 0.29% to $1.0776 and

the yen weakened 0.01% to 155.58 per dollar.

Sterling rebounded to strengthen 0.11% at $1.2510.

Benchmark Treasury yields edged higher following a brief dip

after the jobless claims data.

The yield on benchmark 10-year Treasury note

rose 0.3 basis points to 4.487%, while the two-year note's

yield, which typically moves in step with interest

rate expectations, fell 1.9 basis points to 4.8238%

BULLS IN THE CHINA SHOP

Overnight in Asia, Chinese trade data and some property

market developments had helped Chinese stocks continue their

recent outperformance. MSCI's dollar-denominated China index has

jumped more than 13% over the past two months.

Customs figures showed that China's imports jumped 8.4% in

April from a year earlier, beating expectations for a rise of

4.8%, while exports returned to growth, meeting forecasts, in a

boost to economic growth.

That helped Chinese shares build on earlier gains, with

blue-chip stocks ending up almost 1% and Hong Kong's

Hang Seng index increasing 1.2%. News that China's

eastern metropolis Hangzhou will lift all home purchase

restrictions in the ailing property sector, a key pillar of

domestic demand, also boosted sentiment.

Property shares surged 2.5% as a result.

In other markets, Japan's Nikkei reversed earlier

gains to finish down 0.3%. Australia's resources-heavy share

market lost 1.1% while South Korea also

retreated 1.2%.