Japanese factories raised output by the most in nearly 60 years last month and India grew faster than expected in the March quarter, Friday data showed, further evidence the global economy may have turned a corner.

Stocks rose and commodities were on track for their strongest monthly performance in three decades as investors welcomed tentative signs of an upturn in demand.

Economic data have slowly started to improve, partly spurred by trillions of dollars in government stimulus spending, although doubts remain as to the sustainability of any recovery.

Jobless numbers around the world are growing, deficits are swelling and the number of companies facing bankruptcy is rising.

General Motors Corp remained on track to file for Chapter 11 bankruptcy protection within days, despite persuading major bondholders to accept a sweetened ownership plan on Thursday.

The revised deal is expected to result in a smoother and quicker ride through bankruptcy for the No.1 U.S. automaker.

FACTORIES RAMP UP

But there was some evidence the world economy may finally be finding a bottom.

UK house prices rose for the second time in three months in May, and German retail sales unexpectedly climbed 0.5 percent in April.

India's economy grew a faster than expected 5.8 percent in the March quarter, as a still strong services sector offset a decline in manufacturing.

Japanese factory output jumped in April and manufacturers forecast further gains, while South Korean industrial output expanded for a fourth straight month, data on Friday showed.

The 5.2 percent monthly rise in Japanese industrial output, the biggest since 1953, was much greater than expected and hinted that while restocking of depleted inventories was behind much of the rise, some companies were producing more on expectations of a pickup in demand.

But output remained at low levels, while other figures showed household spending sliding and unemployment at a 5- year high.

Overall demand is better than expected and likely to continue to grow this fiscal year due to government stimulus, but in the next fiscal year, after the stimulus fades, industrial output may stagnate, said Yasuo Yamamoto, senior economist, Mizuho Research Institute.

In a move that supported the stronger output data, Toshiba Corp <6502.T> planned to raise its production of computer chips to a level it was before cuts began in January, Japanese public broadcaster NHK reported on Friday.

Falling inventories and signs of a recovery in overseas demand for chips used in mobile phones prompted the increase, planned for July, NHK said.

ASIAN STOCKS RISE

Shares in Toshiba rose, as did most Asian stocks, following gains of at least 1 percent in major Wall Street indexes overnight. <.N>

Tokyo's Nikkei <.N225> rose 0.8 percent and MSCI's measure of other Asia-Pacific stocks climbed 1.6 percent to its highest since October last year.

Shipping companies outperformed after the Baltic Exchange's main sea freight index <.BADI>, which measures the cost of transporting resources such as coal and iron ore, rose to an eight month high on Thursday.

Energy stocks also rose after oil prices jumped above $65 a barrel on Thursday following OPEC's agreement to keep production targets unchanged.

Industrial demand has pumped up commodity prices across the board in recent weeks, with the Reuters-Jefferies CRB index <.CRB> up 12 percent in May and on its way to the biggest monthly gain since July 1974.

But other indicators remained soft.

British consumer confidence held steady in May, ending three consecutive months of gains and coming in below the consensus forecasts.

While April orders for U.S. durable goods rose by the most in 16 months in April, sales of newly built U.S. single-family homes rose slightly less than expected in the same month and figures for March were revised down.

Underscoring the depth of the crisis in the industry that triggered the global economic slump, one out of eight U.S. households with a mortgage was late on loan payments or in the foreclosure process as of March 31, the U.S. Mortgage Bankers Association said, as the country grappled with its highest unemployment rate in more than a quarter century.

The housing market depends on the unemployment situation, and we don't expect unemployment to bottom out until the middle of next year, so then normally housing would not recover until after employment recovers, said Jay Brinkmann, the association's chief economist.

(Writing by Lincoln Feast; Editing by Jerry Norton)

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