* Asia ex-Japan stocks up 0.5 pct on Wall St gains
* Investors remain wary of outlook despite recent bounce
* Euro steadies near 3-week highs
* Oil falls on worries U.S. economic recovery slowing
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SEOUL, June 18 (Reuters) - Most Asian stocks rose on
Friday, encouraged by a late rebound on Wall Street, while the
euro hovered near 3-week highs against the dollar after a
strong investor response to Spanish bond auctions.
Crude oil extended losses, however, as weak economic
reports reinforced worries that the U.S. economic recovery was
losing steam.
"While the immediate euro zone worries about Spanish debt
have diminished, as with Greece there's a sense that the real
solution to the problems has only been postponed, and this will
provoke some uncertainty," said Nagayuki Yamagishi, a
strategist at Mitsubishi UFJ Morgan Stanley Securities in
Japan.
"But there's no question that risk avoidance has ebbed for
now."
MSCI's index of Asian shares outside Japan <.MIAPJ0000PUS>
rose 0.4 percent to its highest level in a month, mainly on
strength in Hong Kong <> and Australia <>. The index
looked set for a gain of about 3 percent on the week, though it
is still down about 6 percent so far this year on worries about
Europe's festering debt crisis.
Japan's Nikkei <> was slightly lower, but traders said
it could still challenge key resistance levels if it can close
above 10,000 points, which has been been both a support and
resistance level several times over the past year.
While global markets have moved off lows seen in May and
some technical chart patterns look more positive, analysts are
unsure if stocks can stage a convincing recovery in coming
months as worries about Europe and the U.S. economy linger.
Volumes have been thin, indicating investors lack confidence
that shares can gain much traction.
U.S. stocks ended slightly higher overnight as investors
bought defensive shares, but key indexes were lower for much of
the day, weighed down by weak manufacturing and jobless claims
data. Though most economists do not expect the U.S. economy to
slide back into recession, investors fear second half growth
may be tepid, curbing corporate profits. []
The euro <EUR=> was at $1.2384 by midmorning, holding near
its 3-week high of $1.2413 set on Thursday, as investors
liquidated short positions after Spanish bond auctions drew
robust demand.
But Madrid had to pay a hefty premium to sell the bonds
compared with previous issues, indicating investors remain
concerned about whether euro zone countries with shaky finances
will be able to meet their debt oligations. []
While the euro has turned higher after months of turmoil,
analysts polled by Reuters see little end in sight for its
slide against the dollar, which could put fresh pressure on
riskier assets from shares to crude oil and drive more
investors into safer havens such as bonds. []
Median predictions from a survey of more than 50 foreign
exchange strategists released on Thursday showed the single
currency falling to $1.175 in a year's time, a level last seen
in December 2005. Economists see a one-in-five chance that it
could hit parity with the dollar this year.
U.S. crude oil futures extended losses on Friday as the
sluggish economic data raised doubts about the strength of its
recovery.
The West Texas Intermediate crude for July delivery <CLc1>
fell 19 cents to $76.60 a barrel after losing 88 cents
overnight. Oil prices have jumped 18 percent from a trough
below $65 on May 20, but are still down about 12 percent from
early May levels.
(Reporting by Yoo Choonsik; Editing by Kim Coghill)
