GLOBAL MARKETS-Europe's longest stocks sell-off of the year abates

* European stocks snap longest losing streak in a year

* Dollar gains as investors price in more U.S. rate hikes

* Futures tip higher openings for Wall Street

* CISCO and Wal-Mart results help mood

* Nikkei rallies on bargain-hunting after 6-day losing streak

* Peso bounces back from latest NAFTA nose-dive

* Graphic: World FX rates in 2017 http://tmsnrt.rs/2egbfVh

By Marc Jones

LONDON, Nov 16 (Reuters) - Investors tentatively returned to world stock markets looking for bargains on Thursday, after Europe's longest losing streak of the year and the worst run since March for the top global indices.

After five consecutive daily losses on the MSCI (Frankfurt: 3HM.F - news) index of world stocks and seven straight falls in Europe, there was a bounce of sorts.

Benchmark indices in Tokyo, Shanghai and Hong Kong and Seoul all rallied overnight, London, Frankfurt and Paris were up as much as 0.6 percent and futures prices pointed to Wall Street starting percent higher.

Cyclical stocks which had driven the recent sell-off made a comeback in both Europe and Asia while upbeat earnings from Wal-Mart and Cisco cheered U.S. traders ahead of the New York open.

There was some relief too that oil prices had pulled out of what had been a near 5 percent drop and that upbeat U.S. data on Wednesday had helped the dollar halt the euro's sharp recent rise.

"After five or six days of steady selling you have got people coming back in looking for bargains," said CMC Markets (LSE: CMCX.L - news) senior analyst Michael Hewson.

"I think it's temporary though. We haven't had a significant sell off this year and the fact of the matter is that equity markets have done so much better than anyone dared to envisage."

Bond markets, meanwhile, were seeing a broad rise in yields after the mostly upbeat U.S. data had added to expectations the Federal Reserve will hike interest rates again next month, as well as multiple times next year.

Two-year Treasury yields crept to fresh nine-year peaks in European trading, though significantly the U.S. yield curve remained pretty much at its flattest in a decade.

European yields nudged higher too but the standout there was a fall in the premium investors demand to hold French debt over German peers to its lowest in 2-1/2 years, and almost to record lows, on optimism about reforms under Emmanuel Macron.

With Macron "you have a path towards real reform (in the euro zone)," said the chief investment officer of Amundi (Berlin: 350155.BE - news) , Europe's largest asset manager, Pascal Blanque. "And it's gaining credibility."

On a more global basis he added however that the firm was in the process of "risk rotation and risk reduction" and that it was expecting a "bumpy" year next year for equity markets.

NIKKEI RALLY

The liveliest moves in Asia had come in Japan, where the Nikkei turned around early losses to surge 1.5 percent as investors returned after a six-day losing streak there.

There were 0.6-0.8 percent gains for Shanghai and Hong Kong and Seoul, while Australian stocks added 0.2 percent as data showed the country's unemployment rate at its lowest since early 2013.

Wall Street EMini futures for the S&P 500 also pointed to a rebound in U.S. markets later. All the major indices had dropped on Wednesday with the energy sector suffering a four-day decline of 4 percent, its weakest such period in 14 months.

Investor (LSE: 0NC5.L - news) concern over the progress of a massive U.S. tax reform plan showed no sign of abating as two Republican lawmakers on Wednesday criticised the Senate's latest proposal.

U.S. President Donald Trump hit back, tweeting: "Tax cuts are getting close!"

"If we look at what the markets are focusing on, it's still very much the tax cut debates in the U.S., and how much progress there's going to be on this front," said Mitul Kotecha, head of Asia macro strategy for Barclays (LSE: BARC.L - news) in Singapore.

The dollar index, which tracks the greenback against a basket of six major rivals, was slightly higher on the day at 93.828 having hit four- and five-week lows against the yen and euro.

The euro was down around 20 ticks at $1.170, retreating from a one-month top of $1.1860 on Wednesday.

Doubts that the latest round of talks on the North American Free Trade Agreement will make much headway in the face of tough U.S. demands remained though Mexico's peso bounced off an eight-month low it had hit to the previous day.

In commodity markets, gold edged down 0.1 percent to $1,278.26 an ounce. It reached $1,289.09 overnight, its highest since Oct (Shenzhen: 000069.SZ - news) . 20.

Oil prices also began to wilt again after the U.S. government reported an unexpected increase in crude and gasoline stockpiles. They had also lost ground this week on the International Energy Agency's (IEA) outlook for slower growth in global crude demand.

U.S. crude slipped 18 cents to $55.16 a barrel. Brent crude futures were 34 cents lower at $61.53.

(Additional reporting by Abhinav Ramnarayan in London, Lisa Twaronite in Tokyo and Wayne Cole in Sydney; Editing by Catherine Evans and Richard Balmforth)