GLOBAL MARKETS-Battered dollar finds its footing as spotlight falls on Fed

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Dollar recovers for now

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Fed meeting takes place with pressure on Powell

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Big day for tech earnings

By Dhara Ranasinghe and Tom Westbrook

LONDON, Jan 28 (Reuters) - The dollar found its footing on Wednesday after a sharp selloff, with U.S. President Donald Trump seeming to shrug off its recent weakness, while upbeat earnings kept world stocks near record highs ?before a Federal Reserve rate decision.

The U.S. currency nudged off four-year lows but sentiment remained fragile following the sharpest selloff since Trump's tariff blitz rocked markets last April.

European share markets ?fell, while U.S. stock futures pointed to a positive open for Wall Street and Japan's blue-chip Nikkei nudged up. The MSCI World Stock ?Index hovered at record highs.

"Last week when there seemed to be a flight from ?the U.S. in general, you had ?equities falling, Treasuries taking hits, and the dollar falling. Now it's more of a dollar story," said Nordea chief markets analyst Jan von Gerich.

"The most interesting thing about ?the Fed tonight is that Powell could now say something more on ?this political pressure because he's refrained from all of that so far."

The Fed is expected to hold rates steady at a meeting overshadowed by a Trump administration criminal investigation of U.S. central bank chief Jerome ?Powell, an evolving effort to fire Fed Governor Lisa Cook and ?the coming nomination ?of a successor to take over from Powell in May.

ON FX WATCH

The dollar index, which measures the U.S. currency against six major rivals, was 0.25% higher at 96.16 after dropping over 1% on Tuesday to hit a four-year ?low.

Trump said on Tuesday the value of the dollar was "great", when asked whether he thought it had declined too much.

While that view was not new, traders took this as a signal to intensify selling pressure on the dollar at a time when markets are bracing for possible coordinated currency intervention by U.S. and Japanese authorities to stabilise the yen.

The dollar's dive hoisted the euro over $1.20 for the first time since 2021, sent the Australian dollar briefly above 70 cents to a three-year high, lifted gold to a ?new peak and ?boosted commodity prices - which are counted in dollars.

"Often officials push back against abrupt currency moves but when the President expresses indifference or even endorses the move it emboldens USD sellers to keep pushing," said Steve Englander, head of ?global G10 currency research at Standard Chartered in New York.

EARNINGS APLENTY

ASML, the world's largest supplier of computer chip equipment, reported stronger-than-expected bookings for the fourth quarter, highlighting resilient AI demand.

Its shares rallied 5%, outperforming a generally flat European market.

On Wall Street, in addition to the Fed, a day of big tech earnings awaits, with Meta and Tesla reporting after the close.

The weaker dollar filtered through to other assets and helped gold strike a record above $5,280 an ounce and benchmark Brent crude futures to hit a four-month high just above $68 a barrel.

In Asia, hotter-than-expected inflation in Australia in December has ?driven expectations of a rate hike as soon as next week, with ANZ and Westpac switching rate forecasts after the data release to leave all of Australia's "Big Four" banks predicting a hike.

Indonesia's equity market dived 7% after index provider MSCI (MSCI) said it was concerned about opaque ownership and trading and halted updates to Indonesian entries ?in its products, which are tracked by global investors.

(Reporting by Dhara Ranasinghe in London and Tom Westbrook in Singapore; Editing by Timothy Heritage)