* Asia ex-Japan stocks set best week in six months
* Funds back to equities, brushing aside Europe debt woes
* Euro hits new 3-week highs
* Oil falls on worries U.S. economic recovery slowing
* European stocks seen opening slightly higher
By Yoo Choonsik
SEOUL, June 18 (Reuters) - Asian stocks on Friday ended
their best week in six months as investors regained an appetite
for risk and brushed aside European debt concerns, while the
euro hovered near three-week highs against the dollar.
European stock index futures pointed to a higher open with
stocks poised an eighth session of gains. Higher shares in Asia
following Thursday's modest gains on Wall Street boosted
investor hopes of further gains.
U.S. crude futures extended losses as weak U.S. economic
indicators raised doubts about the sustainability of an
acceleration in demand growth by top oil consumer, the U.S.
"Emerging Asian economies were not at the centre of the
financial crisis, as were the United States and more recently
southern Europe," Clemens Kang, a strategist at Woori
Investment & Securities in Seoul.
"Their distance from troubled regions helped them recover
as fast as they did. Also these economies' comparatively robust
rate of economic growth attracted investors."
MSCI's index of Asian shares outside Japan <.MIAPJ0000PUS>
rose 3.6 percent during the week as of 0600 GMT, the biggest
weekly percentage rise since the first week of December last
year, after a 0.4 percent gain the previous week.
On Friday, the index rose as much as 0.9 percent to hit a
one-month intraday high of 394.94 points before settling back
slightly. Hong Kong, Australian and South Korean stocks rose,
while Taiwanese and Chinese shares lost.
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 are not confident
yet that shares can gain much traction.
EPFR Global said in a report on Friday the Global Emerging
Markets Equity Funds took in $1.78 billion, an 11-week high,
while Asia ex-Japan Equity Funds snapped a five-week outflow
streak and EMEA Equity Funds posted a second consecutive week
of inflows. []
EURO HITS 3-WEEK HIGH VS DOLLAR
U.S. stocks had ended slightly higher as investors bought
defensive shares, but important indexes were lower for much of
the day, weighed 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=> hit a new three-week high of $1.2416 and
held firm at $1.2392 by late afternoon, as investors liquidated
short positions after Spanish bond auctions drew robust demand.
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 obligations. []
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.
Despite the robust Asian markets, the West Texas
Intermediate crude for July delivery <CLc1> fell 36 cents to
$76.42 a barrel after losing 88 cents overnight. Oil prices
have jumped more than 15 percent from a trough below $65 on May
20, but are still down more than 10 percent from early May
levels.
(Editing by Jan Dahinten)
