GLOBAL MARKETS-Stocks hurt by bank worries after Deutsche report

* World stocks flat on day; Europe banks hurt

* Wall Street set for modest rise

* Swiss franc falls sharply as safe-haven moves unwind

By Tamawa Desai

LONDON, Sept 10 (Reuters) - Global stocks were pressured by concerns over banks ahead of a meeting to finalise European capital rules at the weekend, while brighter U.S. and Chinese data hurt the safe-haven appeal of the Swiss franc and yen.

Investors teetered between cautious optimism that the U.S. economy would avoid another economic downturn, which boosted U.S. bond yields overnight, and concerns about the fragile European financial system.

"The bulls and bears have knocked each other senseless and are lying in the corner. The bulls are waiting for employment growth and the bears are waiting for European problems to blow up," John Haynes, head of research at Rensburg Sheppards, said.

The MSCI world equity index <.MIWD00000PUS> was marginally lower at 282.96.

News of a possible 9-billion-euro capital increase by Deutsche Bank put some meat on the bones of worries over lenders that have hampered markets this week, sending banking shares 0.7 percent lower by midday European trade <.SX7P>. The FTSEurofirst 300 index <.FTEU3> dropped 0.2 percent.

Central bank governors and heads of supervision from 27 countries meet in the Swiss town of Basel on Sunday to agree tougher bank capital and liquidity standards, part of efforts to prevent repeated future state rescues.

"Deutsche is the strongest and it's going first -- who's behind them?," said Philip Isherwood, equity strategist at Evolution Securities in London. "And there's the uncertainty ahead of the weekend and whether Basel III is ratified, and on what sort of time banks have to rebuild finances."

U.S. futures rose 0.2 percent , pointing to a higher start after rising modestly the previous day.

YEN FALLS, YUAN SPECULATION

Asian shares hit a 4-month high after data on Thursday showed U.S. initial jobless claims fell to a two-month low and the trade deficit narrowed sharply in July. [ID:nN09174403]

China on Friday posted stronger-than-expected import growth in August, indicating a possible rebound in domestic demand, and a 34.4 percent rise in exports year-on-year.

That boosted risk-taking sentiment, prompting the Swiss franc to fall sharply against the euro and dollar.

Sentiment was further buoyed by news Dubai World agreed with its creditors on restructuring its debts. [ID:nLDE6890CV]

"Seems risk being bought ... and people talking about the Dubai news so putting two and two together," one London-based currency trader said.

Buoyed by higher U.S. government bond yields, the dollar recovered to 84.28 yen , its highest since reaching 85.23 yen after U.S. jobs data on Sept. 3. It was last at 84.00 yen, still not far from a 15-year low of 83.34 yen hit last week.

Japanese Prime Minister Naoto Kan said Tokyo would take decisive action if the situation grew more volatile, adding it would try to persuade other countries should it take unilateral action to stem the yen's rise. [ID:nTOE689076]

WILLING TO ACT

Kan has a slight edge over powerbroker Ichiro Ozawa ahead of a party leadership vote next week but is seen too close to call. A Reuters poll showed a win by Ozawa in the vote, which would also decide who is prime minister, would give a short-term boost to stocks but weaken Japanese government bonds and the yen. [ID:nTWKAKE617]

Ozawa reiterated on Friday that while solo currency market intervention may not be effective, the government should make it clear that it is willing to act.

China set the daily yuan mid-point at the highest since the landmark revaluation in 2005, ahead of a U.S. congressional hearing on China's currency practices next week. [ID:nN09225757]

Beijing's announcement that it would bring forward its monthly suite of economic data to Saturday from Monday [ID:nTOE688013] also raised market speculation of an interest rate rise.

U.S. crude oil futures jumped to a near three-week high near $76 a barrel after a shutdown of the biggest pipeline supplying Canadian oil to refineries in the U.S. Midwest. (Additional reporting by Simon Jessop, Simon Falush, Brian Gorman and Naomi Tajitsu; editing by Patrick Graham)