GLOBAL MARKETS-China plans sends world shares higher, gold pauses
* Asian and European shares gain as China moves to support growth
* Gold steadies after big rally, weaker dollar helps
* Equity investors to eye corporate earnings outlooks
LONDON, July 23 (Reuters) - World shares pushed up towards five-year highs on Tuesday helped by China's plans for avoiding a hard landing in its slowing economy, while gold took a breather after its biggest one-day gain in more than a year. Local media in China reported that the government is looking to increase investment in railway projects as it aims to ensure annual economic growth does not sink below 7 percent. The reports saw China shares post their best day in two weeks, driving MSCI's broadest index of Asia-Pacific shares outside Japan up 1.3 percent to its highest since early June. European shares added to their recent gains on hopes that China's plan would boost demand for construction materials, climbing 0.4 percent in early trade with the focus expected to switch to corporate earnings reports. "Earnings have also been relatively good so far, although the bulk of results still has to come. We'll have a better idea of the big picture by the end of the week," said David Thebault, head of quantitative sales trading at Global Equities. An upgraded economic outlook from Japan's government added to the better tone in the markets, lifting Tokyo's Nikkei 0.8 percent, sending the MSCI world equity index up 0.2 percent to within touching distance of the five-year high hit at the end of May. Expectations Japan will stick with its expansionary policies after the government's victory in weekend elections also supported the yen, which hit a one-week peak against the dollar at 99.13 yen before settling back to 99.51 yen. The greenback has been softer against many major currencies, giving an extra shine to gold, as concerns of an imminent reduction in the Federal Reserve's bond-buying stimulus ease. Gold was up 0.1 percent to $1,336.84 an ounce. The precious metal has now recovered nearly $160 from a three-year low of $1,180.71 an ounce hit on June 28. In emerging markets, traders were watching Turkey, where the central bank will decide whether to raise interest rates to shore up the lira after burning through its foreign exchange reserves in a desperate bid to shore up the currency.