* MSCI world equity index up 0.6 percent to 219.79
* Goldman earnings cheer markets but earnings jitters linger
* Government bonds, yen firmer; oil falls
By Natsuko Waki
LONDON, April 14 (Reuters) - World stocks powered to fresh three-month highs on Tuesday after strong earnings from Goldman Sachs, while jitters about other corporate results kept government bonds and the low-yielding yen on a firm footing. Goldman surprised investors by posting a much higher than expected first-quarter profit and said it planned a $5 billion common share sale to pay back government funds. Other bank shares which are due to post their results this week also rallied on Wall Street on Monday.
Investors were not without worries about the global economic slowdown and its impact on corporates. Philips posted a core first quarter loss and General Motors slumped more than 17 percent in Frankfurt as concerns grew the automaker might file for bankruptcy.
However, growing optimism on the banking sector was enough to encourage European investors, coming back after a long Easter holiday weekend, to push the main MSCI world index to its highest level since mid-January.
"The markets have a distinctly optimistic tone this morning and are simply disinclined to engage in negative ... thinking," said Manus Cranny, senior market commentator at MF Global Spreads.
"Optimism abounds for banks, miners and life insurance."
The MSCI world equity index rose 0.6 percent, gaining more than 28 percent after hitting a 6-year low in March.
The FTSEurofirst 300 index rose 1.7 percent while emerging stocks rose 1.4 percent to hit a 6-month high.
U.S. stock futures were pointing to a slightly weaker start on Wall Street where Intel and Johnson & Johnson are expected to report earnings later.
U.S. crude oil reversed earlier losses to rise 1 percent to $50.55 a barrel, helped by a broader rally in risky assets.
"Firm equity markets and the decline in implied volatility across all asset classes suggest that the recovery in risk appetite may last a bit longer," Commerzbank said in a note to clients.
"In this environment, commodity currencies as well as the Swedish crown and Norwegian crown should be able to gain moderately versus the euro while emerging market currencies should also do well."
Safe-haven assets were firmer, reflecting investor jitters over the global economy.
The yen rose a quarter percent to 99.84 per dollar while the dollar also rose a quarter percent against a basket of major currencies.
The euro lost 0.6 percent to $1.3284.
The June bund future rose 44 ticks.
"Government bonds are not good value on a medium-term perspective but the prospects of a deep recession, deflation and quantitative easing should provide support," Adrian Pankiw, strategist at Henderson Global Investors, said in a note to clients. (Additional reporting by Jon Hopkins; Editing by Andy Bruce)