* G7 intervenes to weaken yen, riskier assets gain
* Nikkei rises, European markets open higher
* Dollar spikes more than 3 percent above 81 yen
* Oil rises on UN vote to intervene in Libya
By Hideyuki Sano and Antoni Slodkowski
TOKYO, March 18 (Reuters) - Japanese shares jumped nearly 3
percent and the yen tumbled on Friday after the Group of Seven
agreed on joint intervention to curb the soaring currency and
calm markets jittery over Japan's nuclear power plant crisis.
European stocks looked set to join in the rally, with the
FTSEurofirst 300 <> rising half a percent at the open.
Traders were also citing initial intervention in the euro to
bolster the yen.
Brent crude oil jumped by $2 to close to $117 a barrel
fears of rising geopolitical tension in the oil-rich Middle East
and North Africa, after the United Nations approved military
action to contain Libyan leader Muammar Gaddafi.
The move by the G7 to support Japan as it struggles to cope
with its biggest crisis since World War Two comes a day after
the yen soared to a record 76.25 <JPY=> in chaotic trading.
The dollar rose more than 3 percent to around 81.75 yen
after the G7 announcement, which came just as the Tokyo stock
market opened.
"It was as clear as it could be and it was huge," said Imre
Speizer, a senior strategist at Westpac Bank in Wellington.
"They said they will intervene and the whole world will
intervene. This is much bigger than earlier expected."
Stocks were generally buoyant, particularly in emerging
markets.
Japan's Nikkei share average <> rose 2.7 percent, but
still closed down around 10 percent on the week, which wiped
$350 billion off the stock market.
"The main things investors are worried about now are the
nuclear plant, the impact of the earthquake and tsunami on firms
and power cuts putting pressure on Japanese manufacturers," said
Norihiro Fujito, senior investment strategist at Mitsubishi UFJ
Morgan Stanley Securities in Tokyo.
The yen's surge had initially been prompted by expectations
insurance companies and other firms would repatriate funds to
meet the massive reconstruction costs of the disaster.
Then a wave of stop-losses and options-related selling
kicked in, propelling the yen past its previous record of 79.75
per dollar that occurred in the wake of the 1995 Kobe
earthquake.
OIL RISES
Japan's strongest earthquake on record a week ago raised
concerns of reduced demand from the world's third-largest oil
user and triggered a drop in Brent to a three-week low near $107
two days ago.
"The initial shock in the markets with regards to the
negative impact on growth as well as the short-term effect on
Japanese demand is now subsiding and people are turning to the
medium- and long-term implications of the earthquake on oil
demand and turmoil intensifying in the Middle East," said Yingxi
Yu, a Singapore-based commodities analyst with Barclays Capital.
The involvement of foreign forces in Libya "could prove to
be a further escalation of the situation in Libya. It seems
difficult that this will speed up the flow of Libyan oil back
into the world market," Yu added.
(Additional reporting by Jeremy Gaunt, Masayuki Kitano in
Singapore, Akiko Takeda, Wayne Cole, and Ian Chua; editing by
Patrick Graham)
