Shares just below all-time highs, dollar moves higher

NEW YORK (Reuters) - World share markets hovered just below all-time highs on Tuesday as investors drew encouragement from a rally in China, while Russian stocks enjoyed some respite after three days of heavy selling.

Investors were reluctant, however, to make bold moves ahead of a batch of U.S. economic news due this week, including a Federal Reserve meeting, GDP data on Wednesday and non-farm payrolls on Friday.

Wall Street was little changed as a rally in the telecommunications sector lost steam and a lower earnings forecast from UPS weighed on sentiment.

The Dow Jones industrial average rose 19.21 points or 0.11 percent, to 17,001.8, the S&P 500 gained 1.1 points or 0.06 percent, to 1,980.01 and the Nasdaq Composite added 15.68 points or 0.35 percent, to 4,460.58.

The U.S. dollar hit fresh eight-month highs against the euro and rose slightly against the yen and Swiss franc as traders awaited U.S. economic data and a potentially more hawkish Fed.

Analysts said the Fed, which is expected to cut its monthly bond-buying program by another $10 billion after its two-day meeting ends Wednesday, may hint at an approaching interest rate hike in light of U.S. labor market growth.

"People are starting to believe there is going to be concrete action from the Fed in terms of raising rates," said Joseph Trevisani, chief market strategist at WorldWideMarkets in Woodcliff Lake, New Jersey.

U.S. Treasuries prices increased after a five-year note auction saw solid demand from indirect bidders.

An index of European shares rose 0.3 percent.

Rouble-traded Russian stocks gained despite fresh fighting in Ukraine and expectations of more EU sanctions. The dollar-denominated RTS index , however, was down slightly.

The European Union agreed to impose broad sanctions against Russian oil companies, banks and defence firms, by far the strongest international action yet over Moscow's support for rebels in eastern Ukraine.

Oil prices fell with U.S. crude leading the decline as a refinery fire in Kansas curbed demand for benchmark WTI, while concerns over possible export disruptions stemmed losses for global marker Brent.

Brent futures pared losses after EU governments agreed to impose the additional sanctions on Russia. However, the rebound stalled as concerns eased that the sanctions would impact oil exports in an oversupplied market.

"I think the market is breathing a sigh of relief. The new sanctions against Russia don't seem to be a game-changer, as long as we don't have a supply disruption," said Gene McGillian, an analyst at Tradition Energy in Stamford, Connecticut.

Brent crude was down 20 cents at $107.37 a barrel.

China shares continued their charge overnight, led by banks. The country's fifth-biggest bank by assets said it was studying a plan to sell stakes to private investors. The CSI300 index of leading Shanghai and Shenzhen A-shares added 0.3 percent, its eighth gain in a row, lifting it to a 2014 high.

That, in turn, pushed MSCI's emerging market index to a three-year high and kept the All World benchmark within reach of this month's all-time peak.

(Reporting by Angela Moon)