GLOBAL MARKETS-European stocks hit 2012 highs as ECB meets
* Europe's FTSEurofirst 300 index up 0.75 pct, at 2012 high
* Markets await ECB president's comments on policy outlook
* Euro slides back from 7-week high against dollar
* Oil, gold steady, nervousness ahead of U.S. jobs report
LONDON, Dec 6 (Reuters) - European stocks hit their highs for the year on Thursday while the euro slipped as investors awaited the outcome of a European Central Bank policy meeting for signs of any future rate cuts.
The ECB is expected to keep its benchmark rate at 0.75 percent but will probably slash its growth outlook for 2013, prompting some in the market to expect President Mario Draghi to signal a bias toward a future policy easing.
"I'm not convinced at this stage that the door is open to a further rate cut," said Peter Dixon, global equities economist at Commerzbank. If the central bank were to ease next year it would be via liquidity measures such as bond buying, he added.
The prospect of more support from Europe's central bank, signs of gathering momentum in China's giant economy and the modest recovery in the United States have encouraged investors back into the world's main equity markets ahead of the new year.
The MSCI world equity index, which has gained over 11 percent this year, added 0.3 percent to be at 334 points on Thursday, helped by big gains in Asian shares outside Japan which have reached 16-month highs.
In Europe the FTSEurofirst 300 index of top European shares hit a 2012 high of 1,132.79 points in early trade, a gain of over 0.7 percent on the day. London's FTSE 100 , Paris's CAC-40 and Frankfurt's DAX were as much as 1.3 percent higher.
"The momentum is positive for equity markets, which remain cheap compared with credit and government bonds," said Frederic Jamet, head of management at State Street Global Advisors France.
However, the lack of any progress in Washington at talks among politicians to avoid the "fiscal cliff" of spending cuts and tax rises starting in January is capping the gains.
Financial markets were reassured on Wednesday by a statement from U.S. President Barack Obama that a deal was possible in "about a week" if Republicans compromise on taxes. But neither side has yet to make any concessions.
The lack of a breakthrough was supporting safe-haven government bonds, keeping German Bund futures within tight ranges. Ten-year U.S. Treasury yields were hovering near a three-week low at 1.59 percent.
The euro, which hit a seven-week high of $1.3127 on Wednesday, traded at $1.3060, barely changed on the day.
"We've seen something of a reversal in confidence," said Jeremy Stretch, head of currency strategy at CIBC World Markets.
"Looking ahead, the ECB is unlikely to cut rates but most likely to underline the ongoing weakness in the euro zone economy. Confirmation that the euro zone remains in recession is certainly not providing any underlying support for the euro."
Ahead of the outcome of the ECB meeting, European bond market investors were focused on an auction of new French government paper, which should see good demand due to higher yields than on German debt.
However, a resurfacing of concerns about the prospects for France's economy could be reflected in the bidding.
In crude oil and other commodity markets gains were being checked by niggling worries about the growth outlook for the global economy ahead of Friday's release of the U.S. non-farm payrolls report for November.
Data from Asia on Thursday illustrated a patchy economic picture.
Australian employment topped expectations for a second month in November and the jobless rate unexpectedly fell to a three-month low of 5.2 percent, lifting the local currency by a third of a U.S. cent to $1.0471.
South Korea's central bank, however, said that growth this year in Asia's fourth-largest economy will probably fall below its 2.4-percent target.
U.S. crude futures rose a cent to $87.89 a barrel while Brent was down 7 cents at $108.74
"Overall, the markets are weak with the global economic concerns and will be trapped in a range until the U.S. 'fiscal cliff' issue is behind us," said Tony Nunan, an oil risk manager with Mitsubishi Corp in Tokyo.
Spot gold edged down 0.3 percent to $1,687.74 an ounce, nearing the one-month low of $1,684.40 that it hit on Wednesday after a weaker price forecast by Goldman Sachs.