By Marc Jones
LONDON (Reuters) - Asia and Europe's big bourses kept world shares on their record-breaking run on Tuesday, although a steadier dollar halted the sizzling start to the year for the euro, yen and yuan and sent metals markets down sharply.
MSCI's all-country world index <.MIWD00000PUS> notched its third consecutive all-time high as growing confidence about the global economy pushed Japan's heavyweight Nikkei <.N225>[.T] to its best level since 1991 during a lively Asian session.
The pan-European STOXX 600 <.STOXX> [.EU] then crawled 0.4 percent higher <STOXX> as technology, car and insurance stocks <.SX7P> offset a 1 percent drop in miners <.SXPP> caused by the buckling metals prices. [MET/L]
Copper slumped 2.2 percent <CMCU3>, while nickel plunged almost 4 percent <CMNI3>. For both it was their biggest drop since early December, after which they went on to surge 10 and 20 percent respectively.
Analysts put the wobble partly down to supply issues after stockpiles of iron ore at China's ports leapt to the highest since at least 2004, but also the dollar -- used to price commodities -- pulling out of a four-day dive.
"Everything this year (in commodity markets) has been largely about the dollar," said Crédit Agricole FX Strategist Manuel Oliveri.
"It has been selling off regardless of rate expectations, regardless of the growth outlook," he added, saying he expected it to start to stabilize.
The steadier dollar also brought an end to the euro's four-day hot-streak though there were other factors at play too.
The single currency was buffeted in early European trading by reports that parts of Germany's main opposition party are resistant to reforming a "Grand Coalition" with Angela Merkel's conservatives.
It then took another step back after sources at the European Central Bank told Reuters that despite growing talk it will stop its mass stimulus program at the end of September, policymakers were unlikely to flag its end just yet.
The euro slipped down to $1.2215 <EUR=> from Monday's three-year high of almost $1.23. The Japanese yen <JPY=>, which has also been on a strong run, was 0.15 percent lower at 110.6 per dollar. [FRX/]
Euro zone government bond yields switched direction too, with German Bunds coming off recent highs and low-rated Italian and Portuguese debt outperforming as investors returned to some of 2017's most profitable trades. [GVD/EUR]
"We need more thorough analysis before making any change," one of the ECB sources said.
Wall Street was set to keep the global stocks rolling with futures markets pointing to 0.5 percent to 0.9 percent gains for the S&P 500 <ESc1>, Dow <1YMc1> and Nasdaq <NQc1> which had been closed for a public holiday on Monday.[.N]
Overnight moves in Asia included a 1 percent jump by Japan's Nikkei <.N225> that saw it touch its highest since November 1991 and more gains for high-flying Chinese bourses. [.SS]
Australian shares <.AXJO> had stumbled 0.5 percent though as its heavyweight miners <.AXMM> were bruised by the slide in metals prices. [IRONORE/]
"The yen's appreciation against the dollar has stopped and this brightened sentiment, along with expectations for robust company quarterly results," said Sumitomo Mitsui Asset Management's Masahiro Ichikawa about Tokyo's gains.
Japanese Finance Minister Taro Aso said on Tuesday that he did not see problems with the dollar weakening to around 110.80 yen, but that big swings in currencies would be problematic.
Crude oil prices were also softer after being driven to their highest levels since December 2014 this week by the dollar's weakness and signs that production cuts by OPEC and Russia are tightening supplies. [O/R]
Brent crude futures <LCOc1> were down 30 cents, or 0.4 percent, at $69.94 a barrel after touching a high of $70.37 a barrel on Monday. Gold <XAU=> also shuffled back to $1,334 an ounce, after hitting a near four-month peak. [GOL/]
The other eye-catching move was another battering for crytocurrencies which have had a torrid start to the year following spectacular gains in 2017.
Bitcoin tumbled 18 percent to almost $11,000, after reports that a ban on trading of cryptocurrencies in South Korea was still an option drove fears grew of a wider regulatory crackdown.
The slide triggered a massive selloff across the broader digital currency market, with biggest rival Ethereum down 23 percent on the day and the next-biggest, Ripple, plunging 33 percent.
"It's mainly been regulatory issues which are haunting the cryptocurrency, with news around South Korea's further crackdown on trading the driver today," said Think Markets chief strategist Naeem Aslam.
"But we maintain our stance. We do not think that the complete banning of cryptocurrencies is possible," he said.
(Reporting by Marc Jones; Additional reporting by Lisa Twaronite in Tokyo and Jemima Kelly in London; Editing by Jeremy Gaunt)