GLOBAL MARKETS-Shares up on China relief, Ukraine strains remain

* China GDP grows 7.4 pct, slightly ahead of forecasts

* European shares rebound, Wall Street seen up 0.3-0.5 pct

* Nikkei leads the pack after 3 pct jump, EM inches higher

* Ukraine tensions simmer

(Adds opening of U.S. markets, changes byline, dateline;

previous LONDON)

By Herbert Lash

NEW YORK (Frankfurt: HX6.F - news) , April 16 (Reuters) - Global equity markets

advanced broadly on Wednesday after growth in China beat

expectations and cheered investors worried about its economy,

while the dollar slid on the growing view the Federal Reserve

will keep interest rates lower than normal for a few years.

Wall Street was modestly higher, up for the third straight

day. The Nasdaq Composite continued to rebound from Tuesday's

lows, having gained 2.7 percent from that intraday low of

3946.03 that was just a smidge away from a 20 percent

correction.

China's economy grew 7.4 percent in the first quarter from a

year earlier, topping forecasts of 7.3 percent and dashing

speculation that growth would be closer to 7 percent after a

string of recent soft numbers.

The relief rippled through Asian markets, with Japan's

Nikkei ending up 3 percent, its biggest gain since

February, and spread to Europe and then Wall Street.

MSCI (NYSE: MSCI - news) 's all-country world index rose 0.6

percent. The FTSEurofirst 300 index of leading European

shares was up 0.96 percent at 1,319.40 points. Yet most traders

pegged the gain as a technical rebound after a 1 percent fall in

the previous session.

Earlier this month the European index hit a near six-year

high. But the rally has been halted by worries over the crisis

in Ukraine as well as concerns about the pace of Chinese growth.

"There is a lot of concern about Chinese growth this year so

there is some relief in the GDP number," said Jim Russell,

senior investment strategist at U.S. Bank Wealth Management in

Cincinnati. "We think that is influencing the market today."

On Wall Street, the Dow Jones industrial average rose

73.79 points, or 0.45 percent, to 16,336.35. The S&P 500

gained 6.57 points, or 0.36 percent, to 1,849.55 and the Nasdaq

Composite added 12.401 points, or 0.31 percent, to

4,046.562.

Yahoo (TLO: YA-U.TI - news) was the leading percentage gainer on the S&P

500 as revenue growth accelerated in the last quarter of 2013

for Alibaba (IPO-ALIB.N), in which Yahoo holds a 24 percent

stake. Yahoo shares jumped 5.2 percent to $36.00.

Google (NasdaqGS: GOOG - news) and IBM (NYSE: IBM - news) will report later

, while markets face another test when Fed Chair Janet

Yellen speaks on monetary policy and the economic recovery at

the Economic Club of New York.

Sentiment may get a lift if she offers reassurance that any

rise in interest rates will come well after the Fed ends its

asset-buying program.

The euro took little notice, however, rising 0.2

percent to $1.3837. There were also more bond gains for former

trouble spots Italy, Spain, Portugal and Greece.

The 10-year U.S. Treasury note slipped 6/32 of a point to

boost its yield to 2.65 percent.

SHOW OF FORCE

Capping the upbeat mood were mounting risks in Ukraine after

Russia declared the country to be on the brink of civil war and

Kiev said an "anti-terrorist operation" against pro-Moscow

separatists was under way.

Ukrainian government forces and pro-Russian rebels staged

rival shows of force in eastern Ukraine on Wednesday, though

hopes remained that talks in Switzerland on Thursday between

Ukraine, Russia, the U.S. and EU could cool the situation.

In currency markets, apart from sterling, the majors were

confined to tight orbits with the euro a fraction higher

and the dollar edging up to 102.28 yen.

The main mover was the New Zealand dollar which took a spill

after inflation registered a surprisingly low 1.5 percent in the

first quarter. That prompted markets to pare back expectations

on how far and fast interest rates might rise there.

The kiwi fell to its lowest in more than a week at $0.8603

, and dragged down its Australian counterpart to $0.9371

.

In commodities, gold slipped to $1,299.56 an ounce,

well off Monday's peak at $1,330.90. It had tumbled about 2

percent on Tuesday on heavy stop-loss orders placed by momentum

traders as prices broke below the key 200-day moving average.

Benchmark Brent oil rose 70 cents to a five-week high of

$110.01 on developments in Ukraine and the China data,

while U.S. crude futures were up 33 cents to $104.09.

"The situation in eastern Ukraine has deteriorated in the

past couple of days," Harry Tchilinguirian, head of commodity

markets strategy at BNP Paribas (Milan: BNP.MI - news) , said. "And no one is pricing in

economic sanctions."

(Additional reporting by Marc Jones in London; Editing by

Meredith Mazzilli)