GLOBAL MARKETS-Equities up on firmer metals, oil; pound gains

* Metal prices rise, lifting mining shares, world stocks

* Oil prices gain on weaker dollar

* Euro hits 4-month low against pound

By Dominic Lau

LONDON, Jan 18 (Reuters) - Raw material prices advanced on Monday on strong Chinese demand hopes and on a weaker dollar, lifting commodity shares and global equities, while the euro hit a four-month low against a broadly firmer pound.

Safe-haven government bonds were steady.

European shares advanced, recovering some of the previous session's losses after JPMorgan Chase & Co reported higher loan losses. The pan-European FTSEurofirst 300 <.FEU3> rose 0.7 percent and Brazil's Bovespa benchmark <.BVSP> put on 0.6 percent, lifting the MSCI All-Country World Index <.MIWD00000PUS> 0.2 percent higher.

Earlier, Japan's Nikkei average <.N225> fell 1.2 percent, tracking a weaker Wall Street on Friday after the JPMorgan quarterly earnings.

Among U.S. banks to report results this week are Bank of America , Citigroup , Morgan Stanley , Goldman Sachs and Wells Fargo . Non-financial companies to report quarterly earnings include IBM , General Electric and Google .

"There is a good deal of anxiety over the upcoming reporting season where the fear is that the hurdle rate is set too high and that corporates won't be able to produce topline growth," said Mislav Matejka, European equity strategist at JPMorgan. "However, we think that it would be wrong to write it off."

U.S. markets were closed on Monday for a national holiday.

Metal prices firmed, with copper prices up 1.4 percent and gold up 0.4 percent, while crude prices snapped a five-day losing run, up 0.6 percent to trade above $78 a barrel.

A raft of Chinese data this week, ranging from fourth quarter GDP to December retail sales and industrial production could give clues on whether domestic consumption in China is helping to offset persistent weakness in U.S. demand.

But concerns remain that China's central bank could act again to cool inflation pressures in the economy.

Concerns over Greece's ballooning fiscal deficit weighed on the euro .

"The Greek government has lost all fiscal credibility with the market," said Lee Hardman, currency economist at Bank of Tokyo-Mitsubishi UFJ. "We are also seeing some risk aversion on slowing growth momentum in developed economies."

STERLING PERFORMANCE

Sterling gained on firmer UK housing data [ID:nLDE60D1MQ] and as speculative players chased it higher on reports that French utility GDF Suez was in talks with Britain's International Power for an asset swap. International Power said the talks were over and no deal was reached.

Against the pound, the euro was down 0.4 percent at 88.09 pence, after touching 87.80 pence, its lowest since mid-September. Sterling was up 0.4 percent at $1.6326 .

The dollar index, a gauge of the currency's performance against six other major currencies, eased 0.3 percent.

Yields on benchmark 10-year U.S. Treasuries were steady at 3.673 percent, while those on 10-year Bunds were down 2 basis points at 3.244 percent. (Additional reporting by Tamawa Desai in London; editing by Stephen Nisbet)