* MSCI index hits highest intraday level in almost two years

* Wall Street gains along with Euro STOXX 600

* U.S. business activity picks up, Euro gains after PMI

NEW YORK/LONDON, Jan 24 (Reuters) - MSCI's global equity index rose on Wednesday, hitting its highest level in almost 2 years, backed by positive earnings and economic data in both Europe and the United States as well as optimism China's stimulus will support its stock markets.

U.S. Treasury yields rose in afternoon trading following a government bond auction after earlier falling as investors awaited fourth-quarter U.S. gross domestic product and next week's Federal Reserve meeting.

On Wall Street the benchmark S&P 500 hit new intraday record highs as Netflix shares surged after the video streaming service smashed subscriber growth expectations and chip stocks gained on strong earnings from Dutch chipmaking equipment manufacturer ASML Holding.

Economic data also helped with U.S. business activity picking up in January and inflation appearing to abate. S&P Global said its flash U.S. Composite PMI Output Index, tracking manufacturing and services sectors, rose to its highest level since June, driven by gains in both services and manufacturing.

"Three things really stand out as far as driving stocks today. They're charging higher after some good earnings, a decent set of purchasing manager indexes, and China's continued stimulus efforts," said Brian Jacobsen, chief economist at Annex Wealth Management.

The MSCI world equity index, which tracks shares in 47 countries, was up 0.58%, after earlier hitting its highest intraday level since February 2022.

On Wall Street, at 02:42 p.m. the Dow Jones Industrial Average fell 12.96 points, or 0.03%, to 37,892.49, the S&P 500 gained 15.67 points, or 0.32%, to 4,880.27 while the Nasdaq Composite gained 97.40 points, or 0.63%, to 15,523.34.

Nasdaq was boosted by a more than 1% gain in the Philadelphia Semiconductor index as the ASML report drew investors to a host of companies in the sector.

After coming under pressure recently, Robert Pavlik, senior portfolio manager at Dakota Wealth in Fairfield, Connecticut said "Nasdaq is playing a bit more catch-up today on the back of the semiconductor space."

ASML had also helped cheer European investors with the Europe 600 index closing up 1.18%, for its biggest one-day percentage gain since mid November.

Europe's data was mixed with the manufacturing purchasing managers' index (PMI) showing a tough start to 2024 as euro zone business activity contracted while the outlook improved. Germany and France, the zone's biggest economies, saw improvements in manufacturing PMIs even as services deteriorated.

The European Central Bank (ECB) meets on Thursday and is widely expected to keep rates unchanged. The U.S. Federal Reserve is also expected to keep rates steady when it meets next week but investors will monitor for clues on rate-cut timing.

In Treasuries, the yield on benchmark 10-year Treasury notes rose to 4.1781% compared with its U.S. close of 4.142% on Tuesday. The two-year yield, which rises with traders' expectations of higher Fed fund rates, touched 4.3819% compared with a U.S. close of 4.348%. .

In currencies, the dollar index, which measures the greenback against six rivals, was down 0.26% on track for its biggest daily percentage decline since Dec. 27.

Nevertheless, the index is up about 1.8% for January, eying its strongest monthly gain since September as traders walked back expectations for early and steep Fed interest rate cuts.

Japan's yen, strengthened after the Bank of Japan signalled on Tuesday that it could exit stimulus in the coming months. The dollar fell 0.54% against the yen to 147.56.

Earlier China blue-chips finished up 1.4%, but were still near five-year lows. Bloomberg reported that Chinese authorities were preparing measures worth $278 billion to stabilise the country's slumping stock market though some investors were sceptical and unimpressed.

In commodities, oil prices edged up with a bigger-than-expected U.S. crude storage withdrawal, Chinese stimulus and geopolitical tensions countering concerns about tepid demand.

West Texas Intermediate crude futures settled up 0.97%, or $0.72, at $75.09 a barrel. Brent crude ended up 0.62%, or $0.49, at $80.04.

In precious metals, gold fell 0.86% to $2,011.30 an ounce after the data showing a U.S. business activity pickup, even as the weakener dollar limited losses.

(Reporting by Sinéad Carew in New York, Tom Wilson in London; additional reporting by Ankur Banerjee in Singapore; Editing by Jamie Freed, Angus MacSwan, Chizu Nomiyama and David Evans)