(Updated at 10:46 a.m. ET (1446 GMT)

By Chris Prentice and Amanda Cooper

NEW YORK/LONDON, April 23 (Reuters) - Global shares rose

on Tuesday, driven by a recovery on Wall Street, where investors

are focused on earnings reports from the U.S. megacaps, and the

yen hit multi-year lows against the dollar and the euro.

MSCI's gauge of stocks across the globe

rose 1.05% by 10:46 a.m. (1446 GMT), pulling away from Friday's

two-month low.

On Wall Street, the Dow Jones Industrial Average rose

211.11 points, or 0.55%, to 38,451.09, the S&P 500 was up

49.36 points, or 0.99%, to 5,059.96 and the Nasdaq Composite

gained 206.95 points, or 1.34%, to 15,658.26.

The FTSE 100 eased back from a record high, as the

STOXX 600 rose 1% on gains in the technology sector.

Adding to the optimism was a series of surveys of business

activity that showed Germany returned to growth in early April

after months of contraction, while activity in the broader euro

zone expanded at its fastest clip in nearly a year.

Investors are less concerned right now about the threat of a

major re-escalation of tension in the Middle East and more

focused on earnings.

Against that backdrop, spot gold was down 0.41% at

$2,316.64 an ounce after shedding 2.7% the day before.

"We are turning a bit more positive on risk sentiment. There

still remains a fair bit of uncertainty around geopolitics and

rising U.S. real yields, but we are more positive than we were a

week ago," Mohit Kumar, a strategist at Jefferies, said.

The dollar retreated from its recent highs, but was

comfortably supported by the view among investors that no U.S.

rate cuts will be forthcoming any time soon from the Federal

Reserve and by the climb this month in Treasury yields to their

highest since November.

On Wall Street, big tech shares outperformed ahead of

quarterly results this week.

"Odds are the earnings reports that we see over the next few

weeks will be positive, but obviously there's still issues

around what the Fed will do next," said Shane Oliver, chief

economist at AMP, noting that security concerns also remained.

"It's too early to say that problems in the Middle East have

gone away."

"There are lots of things that could cause volatility

between now and the end of the year. And so we're probably

coming to a more constrained, more volatile period for markets."

Aside from Tesla, Meta Platforms ( META ), Alphabet

and Microsoft ( MSFT ) will release earnings this

week.

MEGA WOBBLE?

UBS on Monday downgraded its rating on the mega-cap

companies, warning that profit growth momentum of the so-called

Big Six technology stocks could "collapse" over the next few

quarters.

U.S. business activity, quarterly economic growth and a

measure of monthly inflation top the macro data bill this week.

Traders now expect the first Fed rate cut to come most

likely in September and see just 40 basis points' worth of cuts

this year, compared with expectations for 150 bps of cuts at the

beginning of the year.

The yield on benchmark U.S. 10-year notes fell

3.3 basis points to 4.59%, from 4.623% late on Monday.

The 30-year bond yield fell 1.6 basis points to

4.7075% from 4.724% late on Monday.

The two-year note yield, which typically moves in

step with interest rate expectations, fell 2.9 basis points to

4.9417%, from 4.971% late on Monday.

The European Central Bank is expected to cut rates in June

and this divergence with the Fed is weighing on the euro

. It was last up 0.14% at $1.0667, not far off last

week's five-month low of $1.0601.

The yen slid to another 34-year low.

Japan's finance minister Shunichi Suzuki said last week's

trilateral meeting with his U.S. and South Korean counterparts

laid the groundwork for Tokyo to take appropriate action in the

foreign exchange market.

This is the clearest warning yet from Japanese monetary

authorities that tolerance for the slide in the currency is

wearing thin and official intervention to prop it up is likely.

Oil prices were up as investors continued to assess the

situation in the Middle East. U.S. crude gained 0.27% to

$82.12 a barrel and Brent futures rose to $87.18 per

barrel, up 0.21% on the day.

(Additional reporting by Stella Qiu in Sydney; Editing by Ros

Russell, Tomasz Janowski and Emelia Sithole-Matarise)