GLOBAL MARKETS-Shares rise on China hopes, euro hits 7-wk high
* European shares climb 0.3 pct in early trading
* Euro hits 7-week high, dollar regains vs yen
* MSCI Asia ex-Japan at 16-mth high, policy hopes buoy China
LONDON, Dec 5 (Reuters) - The euro hit a seven-week high and European shares continued their recent rally on Wednesday after comments from China's new leader boosted global growth expectations.
A busy day is in store for European-focused investors with closely-followed purchasing manager data due for release, Spain and Germany testing the recent pick up in euro zone bond markets and Britain laying out new budget plans.
European shares, which have risen more than 5 percent in the last two weeks, were up 0.3 percent at 0820 GMT, pushing the MSCI index of world stocks up over 0.2 percent towards a recent six-week high.
London's FTSE 100, Paris's CAC-40 and Frankfurt's DAX showed gains of 0.5-0.6 percent, while a 0.4 percent gain in U.S. stock futures hinted at a similarly firm Wall Street open.
Asian equities had set the upbeat tone, hitting a 16-month high after remarks from new Communist Party chief Xi Jinping, who said that the government aimed to stabilise exports and make policies more targeted and effective.
"There was positive news out of China... The miners are rallying following stronger commodities and at least for now we head higher and can put the 'fiscal cliff' on the back burner for the time being," said Jawaid Asfar, a trader at SecurEquity, referring to talks to avert U.S. tax rises and spending cuts.
In currency markets, the euro climbed to a seven-week high of $1.3127 against the dollar, boosted by efforts to tackle the debt problems of Greece and Spain, while the dollar came under pressure from expectations of new bond buying by the Federal Reserve.
German government bonds edged lower before Germany's final bond auction of the year. The Bund future was 16 ticks lower on the day at 142.58, but low-risk bonds were not seen falling far with market focus on upcoming U.S. data.
In a further litmus test of investor appetite for higher-yielding euro zone sovereign debt, Spain also sells up to 4.5 billion of three-, seven- and 10-year bonds as it attempts to take advantage of the recent improvement in sentiment.