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Nikkei up 0.4%, European shares open up

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Wall Street stock futures lower

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Scant clarity as yet on US trade talks

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Mega-cap earnings, US jobs and GDP data all loom

(Recasts from London, updates throughout)

By Dhara Ranasinghe and Wayne Cole

LONDON, April 28 (Reuters) - Global equity markets held

at their best levels in over three weeks on Monday, reflecting

some hopes that the worst of tariff pain is over, but confusion

over U.S. trade policy lingered and trapped the dollar.

European shares opened higher, U.S. stock futures were mixed

and Asia made fractional gains at the start of an earnings-heavy

week that also sees the release of key U.S. jobs data and is

book ended with elections in Canada and Australia. U.S.

President Donald Trump looms large in both.

Trade tensions remained a key focus.

While Trump has claimed progress is being made on trade with

China, and many other countries, evidence is lacking. Treasury

Secretary Scott Bessent failed on Sunday to back Trump's

assertion that tariff talks with China were under way.

"The fact that we are going through a de-escalation in trade

tensions doesn't mean that we won't still get a growth

slowdown," said Mike Kelly, global head of multi-asset at

PineBridge Investments.

The often confusing rollout of tariffs is expected to

inflict lasting damage on the global economy as uncertainty

weighs on business and consumer confidence, slowing investment

and spending.

"Uncertainty is not just about a one-off event but its

duration," Kelly added.

MSCI's world stock index hovered near its

highest levels since April 3, the day after Trump unveiled his

reciprocal tariffs that roiled markets.

Japan's Nikkei rose 0.4%, while Chinese blue chips

were little changed as officials stuck with their

economic growth projections, despite the drag from tariffs.

European shares opened broadly firmer. Going the

other way, S&P 500 futures dipped 0.25% and Nasdaq

futures eased 0.3%. The S&P has bounced almost 12% from

an April 8 trough, but remains 10% below its peak.

Corporate earnings have been generally supportive, with

gains of more than 9%, though BofA noted 64% of companies had

beaten earnings per share (EPS) guidance, compared to 71% the

previous quarter.

"Despite having played second fiddle to geopolitics of late,

the U.S. earnings season is moving along well and is on track

for its seventh consecutive quarter of positive earnings'

growth," said Rory McPherson, chief investment officer at Wren

Sterling.

About 180 S&P 500 companies representing over 40% of the

index's market value report this week, including mega-caps Apple ( AAPL )

, Microsoft ( MSFT ), Amazon ( AMZN ) and Meta Platforms ( META )

.

DOLLAR HELD HOSTAGE

In currency markets, the dollar was mostly steady but

struggling to make headway as trade wariness lingered.

At 143.81 yen and $1.1345 per euro the

greenback has, for now, found a footing, while staying on course

for its largest monthly fall in nearly 2-1/2 years as Trump has

rattled confidence in the dependability of U.S. assets.

It is down more than 4% on both the euro and the yen in

April, though bounced at the end of last week on a conciliatory

shift in the tone of U.S.-China relations.

A solid U.S. jobs report on Friday could aid the dollar's

bounce if it dampens Federal Reserve rate cut expectations,

analysts said.

Money markets imply a roughly 65% chance of a rate cut in

June and 85 basis points of easing by year-end.

"The greenback is still hostage to the (U.S.)

administration's whims," said Jonas Goltermann, deputy chief

markets economist at Capital Economics.

Inflation numbers for Germany and the euro zone due this

week meanwhile are expected to show a further dip in headline

inflation, adding to expectations the European Central Bank will

cut rates again at its June meeting.

The Bank of Japan meets this week and is considered certain

to hold rates at 0.5%, given the economic and trade uncertainty

caused by U.S. tariffs argues against another hike.

Treasuries have also steadied in the wake of Trump's

assurance he would not try to fire Fed Chair Jerome Powell,

leaving 10-year yields at around 4.25% compared to

the April top of 4.592%.

Former Federal Reserve Governor Kevin Warsh, with whom Trump

is reported to have discussed firing Powell and installing him

in his place, on Friday unleashed a barrage of criticism of the

Fed and argued for fundamental changes to how it operates.

A tentative improvement in risk sentiment saw gold slip 0.8%

to $3,290 an ounce, from its all-time peak of $3,500.

Oil prices were little changed, with Brent flat

around $67 a barrel, while U.S. crude added 0.25% to

$63.16 per barrel.