* Yen extends gains, Japanese exporters sell dollars
* Euro, sterling, Aussie all fall vs yen
* Shanghai shares drop 3.5 pct, extending last week's slide
* Profit-taking as stocks fall, nerves about recovery
By Charlotte Cooper
TOKYO, Aug 17 (Reuters) - The yen rose on Monday, hitting its
highest in more than two weeks against the euro, as weak U.S.
consumer morale clouded the outlook for a quick global recovery
and spurred profit-taking in commodity-linked currencies.
The Australian and New Zealand dollars shed about 1 percent
against the Japanese currency and the U.S. dollar, extending a
fall which began on Friday and saw them stumble from their latest
2009 highs against the greenback.
Both currencies have been popular with investors betting they
will be among the first to benefit from economic recovery and
they have rallied in tandem with stock and commodity markets.
But Asian share markets were down Monday, with the Shanghai
Composite index <> sliding more than 4 percent and extending
last week's 6.6 percent drop.
Falls were broad-based, with oil prices also falling below
$67 a barrel <CLc1> and extending Friday's 4.3 percent decline as
investors continued to book profits from recent gains in risk
assets.
Analysts said investors will likely continue cutting long
positions in risky assets and buy the yen and the dollar back if
other emerging markets which have been trading firmly start
falling together with the slide in Chinese stocks.
Indian shares shed more than 2 percent <>, while the
South Korean stock market lost 2.7 percent <>.
"In the long run, buying of risky assets with economic
recovery hopes will likely to continue. But a short-term
correction of those trades looks set to stay for this week or a
few more weeks, pushing the dollar and yen up and cross/yen
down," said a currency analyst for a U.S. bank.
Consumer confidence fell in August for the second straight
month and revived concern about the U.S. economic turnaround.
[].
"Weak data is no longer treated as a harbinger of an
economic apocalypse, but as an indication that the forthcoming
period of growth is likely to be frustratingly tepid relative
to the rich valuations of risk-sensitive asset markets," said
David Watt, a senior currency strategist at RBC Capital Markets.
The dollar also fell against the yen but its losses were mild
after a half-yen fall on Friday, and it was up on the day against
the euro.
The greenback dropped 0.3 percent from late New York levels
to 94.60 yen <JPY=>, close to its lowest for the month but still
within a broad range of 91.70-98.00 seen since mid-June.
Traders said selling by Japanese exporters and by Japanese
securities houses had weighed it down, while speculation about
repatriation of receipts from U.S. Treasury coupons and
redemptions also contributed to its fall.
Japan's economy grew for the first time in five quarters in
the April-June period, expanding 0.9 percent and ending its
longest recession in decades on the back of exports and
government stimulus spending. []
The data puts Japan in the first camp of G7 economies that
have pulled out of recession, but analysts say the road to
sustainable recovery will be long. Traders said the data was
positive but in line with expectations.
Dealers said the euro fell against the yen after hitting
stop-loss sell orders at 134.00 yen. It was down 0.7 percent at
Y133.80 <EURJPY=R>.
"Euro/yen is still range-trading. In the short term I think
there will be some selling pressure but in the medium term it's
still in a range," a senior trader a big European bank said.
The euro shed 0.4 percent to $1.4148 <EUR=>, retreating
further from this month's 2009 peak of $1.4448.
The Australian dollar was well below an 11-month high of
$0.8479 struck on Friday, trading at $0.8220 <AUD=D4>, and was on
the defensive at 77.76 yen <AUDJPY=R>, down 1 percent.
It was also underperforming its New Zealand counterpart,
striking its lowest in four months at NZ$1.2232 <AUDNZD=R>,
according to Reuters data.
The kiwi dollar fell 1 percent to $0.6700 <NZD=D4> and 63.28
yen <NZDJPY=R>.
(Additional reporting by Anirban Nag in Sydney and Satomi
Noguchi in Tokyo; Editing by Michael Watson)
