REUTERS

Bangkok - World stock markets mostly advanced on Thursday after Japan's third quarter GDP was revised higher and the extension of US tax cuts boosted expectations of stronger economic growth in the short-term.

The upswing came after modest gains in the US, where stocks fluctuated before turning positive late in the session. A compromise in Washington to extend tax cuts boosted shares and sent bond prices sharply lower, as some investors expect it to lead to stronger growth in the world's No. 1 economy.

Early in Europe, France's CAC-40 was up 0.7 percent at 3,858.85

and Germany's DAX rose 0.5 percent to 7,013.24. Britain's FTSE 100

gained 0.6 percent to 5,831.16.

Wall Street was set to rise with Dow futures ahead by 53 points, or 0.5 percent, at 11,421 and S&P futures up by 6.4, or 0.5

percent, to 1,235.30.

In Asia, Japan's benchmark Nikkei 225 stock average closed up 0.5 percent to 10,285.88 as the dollar hovered near 84 yen, bolstering exporters who in past months were struggling against a much stronger yen.

Adding to the positive mood was revised figures that showed the economy grew an annualised 4.5 percent in the third quarter, more than initially estimated.

Hong Kong's Hang Seng index rose 0.3 percent to 23,171.80. South Korea's Kospi jumped 1.7 percent to 1,988.96 thanks to buying of tech and banking shares.

Australia's S&P/ASX 200 climbed 0.9 percent to 4,741.30 amid figures showing the unemployment rate fell to 5.2 percent and the number of employed people jumped by 54,600.

China's Shanghai Composite Index bucked the trend, losing 1.3

percent to 2,810.95 amid continued jitters that interest rates will be raised by the central bank. Benchmarks in Taiwan and Singapore climbed.

The Dow Jones industrial average inched up 0.1 percent to 11,372.48 on Wednesday. The broader Standard & Poor's 500 index rose 0.4 percent, to a new yearly high of 1,228.28.

In currencies, the dollar slipped to 83.80 yen from 84.01. The euro rose to $1.3293 from $1.3261.

Benchmark crude for January delivery climbed $1.10 to $89.39 a barrel in electronic trading on the New York Mercantile Exchange. The contract lost 41 cents to settle at $88.28 on Wednesday. - Sapa-AP