* China bank reserves hike raises fears of more tightening
* Copper down on Chinese imports data; oil drifts lower
* World stocks fall; dollar hits a two-week high
* Irish spreads hit a euro lifetime high
By Dominic Lau
LONDON, Nov 10 (Reuters) - World stocks and copper prices fell on Wednesday on concerns about softening demand from China after slower-than-expected import data, while the dollar recovered further and hit its highest level in two weeks. Borrowing costs for Ireland rose to a euro lifetime high after a clearing house raised margin requirements for Irish debt, highlighting nervousness about the country, which is struggling to pass the first of four austerity budgets next month.
Data showed Chinese October import growth was slower than expected, indicating softening domestic demand.
China, a major engine of global growth, has also raised required reserves for its biggest banks to mop up some of the cash that is streaming into the country and posing a growing inflationary threat, following a fresh round of money-printing by the U.S. Federal Reserve.
The move fuelled worries that Chinese authorities may further try to cool economic expansion.
"Growth in China imports has slowed down, that will be a bit of a concern for the market," Heino Ruland, strategist at Ruland Research in Frankfurt, said. "But earnings have been better than expected and any dip could be a buying opportunity."
Stock markets in Hong Kong and China fell, while world equities measured by the MSCI All-Country World Index lost 0.5 percent.
Japan's Nikkei average rose 1.4 percent to its highest close in more than four months, buoyed by financial shares, with Mizuho Financial up 7.6 percent, after a report that most major Asian banks may be exempt from planned new global rules.
However, people close to the G20's taskforce on financial regulation said global regulators have yet to draw up lists of banks judged "too big to fail".
U.S. stock index futures were down 0.05 to up 0.1 percent, indicating a steady open on Wall Street, ahead of weekly jobless claims data.
Europe's FTSEurofirst 300 dropped 0.3 percent, led by commodity stocks after China's copper imports fell to their lowest level for a year and oil shipments were down 30 percent. Copper fell 1.3 percent, while gold rose 0.8 percent though off its record high hit in the previous session.
Oil eased 0.2 percent to trade below $87 a barrel after hitting a two-year high on Tuesday.
DOLLAR BOUNCE
The dollar index, which measures the greenback against a basket of major currencies, rose 0.4 percent, recovering from a 11-month low last week.
The correlation between Europe's broad STOXX 600 index and the dollar index hit -0.93 on a rolling 25-day average, the strongest negative correlation between the two indexes since 1993.
The euro dipped 0.1 percent to $1.3766.
Analysts still expect more quantitative easing by the Fed will continue to sting the U.S. currency versus the euro as the European Central Bank sticks to its current monetary policy.
"Despite the correction we've been seeing, the euro's bull trend is still in place," said John Hydeskov, senior currency analyst at Danske in Copenhagen.
However, the euro zone sovereign debt problem remained a worry for investors. European clearing house LCH.Clearnet announced it has hiked margin requirements for Irish debt.
The premium investors demand to hold 10-year Irish government bonds rather than benchmark German Bunds widened by 10 basis points to 582 bps.
"Though the LCH announcement overnight wasn't good, it has largely already been priced in, it doesn't inspire confidence," a bond dealer in Dublin said. "What with the budget (issue) still out there, we'll be under pressure until that's passed."
Yields on 10-year German Bunds rose 4 bps to 2.479 percent, while those on 10-year U.S. Treasuries rose 3 bps to 2.6967 percent. (Additional reporting by Joanne Frearson, Blaise Robinson, Naomi Tajitsu, George Matlock and Paul Day; Editing by Giles Elgood)