* Chinese economy slowed sharply in Q2
* U.S. yields, dollar pull back after Fed officials' comments
* European markets firmer, with eyes on Italy political crisis (Releads, updates throughout, changes byline, dateline)
By Sujata Rao and Tom Westbrook
LONDON, July 15 (Reuters) - World stocks attempted a move higher on Friday after four days of losses caused by mounting fears of economic downturn, even though the growth concerns were fanned further by data showing a sharp slowdown in China.
Markets enjoyed some relief from selling after two Fed policymakers on Thursday hosed down bets on an aggressive 100 basis-point (bps) interest rate rise this month.
But they did not dispel fears that central banks' drive to get on top of galloping inflation will wallop the global economy.
Recession fears were fanned further by data showing a sharp second-quarter slowdown in the China, reflecting the colossal hit from widespread COVID lockdowns. Annualised 0.4% growth was the worst since at least 1992, excluding early-2020 when the COVID pandemic erupted.
The data sent Chinese shares 1.7% lower and dragged an Asian ex-Japan index to two-year lows , while signs of property sector stress weighed on Hong Kong-listed developers.
"The recession angle is becoming stronger, backed by data showing things are cracking underneath the surface," Salman Ahmed, global head of macro at Fidelity International.
He was referring to weakening economic data almost everywhere, contrasting with high inflation and tight labour markets.
"We moved rapidly from a stagflationary set-up to more of a recession-dominated one, and very strong inflation is adding to fears that the Fed will need to do more front-loaded tightening."
Bets had grown the Federal Reserve could raise rates by a full percentage points this month, following U.S. data showing a 9.1% inflation print. But Fed Governor Christopher Waller and St. Louis Fed President James Bullard, generally considered policy hawks, said on Thursday they favoured a 75 bps move.
Markets still assign about a 45% chance to a bigger increase, but the comments eased a Wall Street sell-off and futures tip a flat to firmer opening for New York on Friday .
A pan-European equity index rose 0.7%, helped also by news Italy's president had rejected Prime Minister Mario Draghi's resignation. Italian shares bounced 0.9%, though they remain 5% lower on the week.
Signs from companies' second-quarter earnings, meanwhile, are not so far encouraging; a raft of European firms posted downbeat results on Friday, following Thursday's below-forecast figures from big U.S. banks.