GLOBAL MARKETS-Yuan at 16-month high on upbeat China data, dollar in decline

* China economic data boosts markets, yuan at 16-month high
* Dollar in the doldrums, euro and EM FX on hot streaks
* Central bank meetings dominate week's agenda
* Oil up to $40 again, gold shines again
* Graphic: 2020 asset performance http://tmsnrt.rs/2yaDPgn
* Graphic: World FX rates in 2020 http://tmsnrt.rs/2egbfVh
*

By Marc Jones
LONDON, Sept 15 (Reuters) - World stocks rose on Tuesday on
the back of upbeat Chinese data and optimism about novel
coronavirus vaccines, as a struggling dollar kept the hot
streaks for the euro and some of the biggest emerging market
currencies sizzling.
The euro's EUR= fifth day of gains made for a slow start
in continental Europe .EU but a solid 0.8% rise on London's
international and commodity-heavy FTSE .FTSE maintained the
overnight momentum from Asia and Wall Street. .N
The eye-catching move was a 16-month high for the yuan
CNH= B9N2F802B . A 5.6% jump in Chinese industrial output in
August was the best since before the spread of the coronavirus
and retail sales grew for the first time this year. "Strong external demand, a further recovery from the
pandemic and pent-up demand from the floods all contributed to
the robust activity data in August," Ting Lu, chief China
economist at Nomura, said in a note to clients.
"We expect a further, albeit gradual, recovery of the
services sector, a steady improvement in retail sales and
elevated fixed-asset investment growth."
With sentiment also boosted by hopes for a COVID-19 vaccine
after British drugmaker AstraZeneca restarted its vaccine trial
and the dollar extending recent losses, other currencies were
also on the rise.
The euro was up 0.2% at $1.1891 EUR= ahead of Germany's
monthly ZEW sentiment survey, the Australian and Kiwi dollars
both gained as did Britain's pound GBP= as traders showed
little reaction to the government winning an initial vote on its
new Brexit bill. With the yuan CNH= leading the charge, MSCI's EM FX index
also climbed to a near 7-month high. .MIEM00000CUS .

SUGA RUSH
Overnight, MSCI's broadest index of Asia-Pacific shares
outside Japan .MIAPJ0000PUS had added 0.5%, for a fourth
straight day of gains that hoisted it up 3% for the year after
reversing its coronavirus plunge.
E-Mini futures for the S&P 500 ESc1 put on 0.4%, also
reversing early losses, while Europe's STOXX 600 .STOXX just
about clawed itself into positive territory.
"The activity data today shows that the recovery in the
private sector gained momentum in August. The recovery in China
has become more balanced and broad-based," HSBC economists said
in a report.
The yen JPY= nudged higher as Japanese Chief Cabinet
Secretary Yoshihide Suga won a ruling party leadership vote, as
expected, paving the way for Japan's first change of leader in
nearly eight years.
Investors, meanwhile, took profit on a three-day rally in
Japan's stock market, pushing the Nikkei .N225 down 0.4%.
"He's seen as someone who's particularly stock market
friendly. The fact that we've got political certainty for the
next two years from someone who's connected to the free market
is going to be good news for Japan," said Jim McCafferty, joint
head of Asia Pacific equity research at Nomura.
There is still plenty of action to come this week.
U.S. retail sales figures from August are due on Wednesday
and the U.S. Federal Reserve starts a two-day policy meeting
later, the first since unveiling a landmark shift to a more
tolerant stance on inflation in August.
The Bank of Japan and the Bank of England are set to
announce their respective policy decisions on Thursday too.
In commodity markets, most industrial metals were bolstered
by the robust Chinese data. MET/L
Brent crude LCOc1 climbed back to $40 a barrel too O/R
and gold prices XAU= put on 0.4%, extending a sharp rise in
the previous session. GOL/

(Additional Reporting by Anshuman Daga in Singapore; Editing by
Ana Nicolaci da Costa)