GLOBAL MARKETS-Share gains capped as corporate earnings eyed
* MSCI Global share index flat as corporate earnings eyed
* Brighter economic outlook supports recent rally
* Euro, dollar extend falls vs yen despite BOJ steps
* Vote on U.S. debt ceiling awaited
LONDON, Jan 23 (Reuters) - World shares hovered near 20-month highs on Wednesday, supported by some upbeat corporate earnings, an easing of fears about the U.S. debt ceiling and a better outlook for the global economy.
But with many major equity indexes close to levels not seen since the financial crisis began five years ago while the outlook for global growth remains modest, investors have become cautious about pushing higher until they see how company earnings fare.
"In terms of the market, the crisis is over, but in terms of the real economy, we still have to live through some of the effects," said Nick Kounis, head of macro economic research at ABN AMRO.
However, he added: "We think enough has been done to sow the seeds of a gradual economic recovery this year which will gain pace next year."
Europe's FTSEurofirst 300 index was little changed near a 22-month high on Wednesday. Germany's DAX, which is close to a high since 2008, was up 0.2 percent, and the UK FTSE 100 index had gained 0.1 percent, having briefly reached a 2013 peak.
The focus in the major share markets was on corporate earnings. Mining giant BHP Billiton pointed to solid iron ore demand from steelmakers, and consumer goods conglomerate Unilever reported strong sales growth.
Though this was offset to some extent by a weak performance by the telecom sector.
Overall, of the 13 percent of companies on the S&P 500 index that have reported results so far, 75 percent have met or beaten forecasts, according to Thomson Reuters StarMine.
In Europe, only 2 percent of all STOXX Europe 600 firms have announced results, but 86 percent of them have met or beaten expectations.
The European debt markets were still basking in the glow of Tuesday's strong 10-year bond sale by Spain, which was swamped with demand from foreign investors, with Portugal expected to return this week for the first time since its 2011 bailout.
German 10-year yields were 1.5 basis points lower , but traders said this had more to do with some investors looking to balance their portfolios as the month end approached following recent gains in peripheral debt.
Prices have risen across the euro zone debt market this month as foreign investors returned, reassured by the European Central Bank's policies to support the region and a strong desire for higher yielding assets.
Sentiment in all markets is expected to improve further if the U.S. House of Representatives votes in favour of a measure to extend the U.S. debt limit for nearly four months later today, ending fears the government could fail to meet its debt obligations.
Meanwhile, the yen pushed higher against the dollar and the euro as monetary easing announced in Japan on Tuesday by the central bank failed to satisfy some investors.
The Bank of Japan doubled its inflation target to 2 percent and adopted an open-ended commitment to buy assets starting in 2014, disappointing some in the market looking for more immediate easing steps.
The dollar fell 0.4 percent to 88.30 yen, while the euro slid 0.8 percent to 117.42 yen. The weakness of the common currency against the yen also dragged it lower against the greenback.
Oil prices were steady as investors awaited inventory data from the United States for clues to demand in the world's largest oil consumer.
Brent crude was 10 cents up at $112.52 a barrel, and U.S. crude for March delivery rose 11 cents to $96.79, off a four-month high of $96.90 hit earlier in the day.