* European shares climb, Nasdaq expected to open 3% higher * MSCI ex-Japan index hits highest since early 2018 * Wall St wagers election to result in gridlock for Biden * Lessens risk of regulation, tax rises * Bonds well-bid on diminished chance of government spending * BOE injects another 150 billion pounds into bond buying * Pressure back on for Fed-led monetary stimulus * Emerging market FX sees strong gains, yuan at 28-month high * Graphic: 2020 asset performance tmsnrt.rs/2yaDPgn * Graphic: World FX rates in 2020 tmsnrt.rs/2egbfVh LONDON, Nov 5 (Reuters) - World tech stocks and bond markets extended their blistering rally on Thursday as Democrat Joe Biden inched closer to winning the White House and Britain’s central bank became the latest to say it will pump out more stimulus. Biden is now favoured to oust Donald Trump after victories in Michigan and Wisconsin. But with Democrats unlikely to win control of the Senate, investors leapt on the idea of gridlock in Congress sparing Silicon Valley tougher regulation. European tech shares jumped nearly 3%, while Nasdaq futures pointed to it doing the same thing when Wall Street reopens, after Amazon, Facebook and Google all soared 6% to 8% on Wednesday. The bond bulls were also happy after the Bank of England added another 150 billion pounds ($195.20 billion) to its asset purchase programme. Italy’s five-year bond yields fell below zero for the first time, while the U.S. Fed was also expected to sound reassuring later. “The big bad wolf of regulation and taxes is further away from the door and many who have de-risked into the event will be forced to re-risk,” said Michele Pedroni, a fund manager at Decalia Asset Management in Geneva, referring to the likely election outcome having some advantages. Asia stocks had rallied 2% overnight to reach their highest since February 2018. Japan’s Nikkei rose 1.7% to a more than nine-month top, South Korea gained 2.4%, and Chinese blue chips added 1.3% on hopes a Biden White House would ease up on tariffs. The race was coming down to close contests in five states. Biden held narrow leads in Nevada and Arizona while Trump was watching his slim advantage fade in must-win states Pennsylvania and Georgia as mail-in and absentee votes were being counted. The Republican president clung to a narrow lead in North Carolina as well, another must-win for him, but he has also filed lawsuits and demanded recounts that could keep some uncertainty dragging on. The divided Congress that looked likely to emerge was “often seen as the ‘goldilocks scenario’ for financial markets - no radical policy changes and the Fed providing ample liquidity to try to support the economy and financial markets when required,” said Randal Jenneke, a portfolio manager at T. Rowe Price. (For the latest election results and more coverage, click: here) EMERGING WINNERS Bond markets assumed a divided government would greatly reduce the chance of debt-funded spending on stimulus and infrastructure next year, and thus less bond supply. That saw 10-year Treasury yields fall to 0.74%, having touched a five-month top of 0.93% at one stage on Wednesday. The overnight drop of 11 basis points was the largest single-day move since March’s COVID-19 panic. The diminished chance of U.S. fiscal stimulus will put pressure on central banks globally to inject liquidity. The Bank of England added 150 billion pounds to a total target of 895 billion pounds as it sought to cushion Britain’s struggling economy against a second coronavirus lockdown. In addition, the Federal Reserve will probably be called on, too, said Chris Beauchamp, chief market analyst at IG, even if it decides to lay low this time. “The Fed in particular will have to take up its QE role again with a weary sigh, in order perhaps to provide yet another bridge to the future when, hopefully, a government stimulus package will have been agreed,” Beauchamp said. The prospect restrained the dollar, after a wild ride overnight. The dollar index was last down 0.6% at 92.888 and set for its biggest three-day drop since July. The greenback also scuttled back to 104.15 yen after rising as high as 105.32 overnight. The euro sprang to $1.1812 , up from a low of $1.1602, while Mexico’s peso and a 28-month high for China’s yuan led broad-based gains in emerging market currencies. “If you look at the renminbi (yuan) move, it is definitely pricing in an alleviation of the trade tensions,” said Lombard Odier’s Global Head of FX Strategy Vasileios Gkionakis. “And I still think the dollar goes lower from here.” PRECIOUS Sterling recovered after a bumpy ride on Wednesday amid troubles of its own. Little sign of a breakthrough on Brexit has appeared, and the Telegraph newspaper had earlier reported the BoE was considering a move into negative interest rates. The pound gained to $1.3023, still down from an overnight peak of $1.3139. All the talk of policy easing put a floor under gold prices, leaving the metal up at $1,923 an ounce and the other main precious pairing of silver and palladium both up 3%. Oil prices ran into some profit-taking. They had jumped overnight on speculation a deadlocked U.S. government would be unable to pass major environmental legislation that favoured other forms of energy. U.S. crude slipped to $38.72 a barrel, though that followed a rise of 4% on Wednesday. Brent crude futures fell 50 cents to $41.02 after a 15% bounce over the last three days. ($1 = 0.7685 pounds)