Asian shares gain but wariness ahead of G20

By Rafael Nam

HONG KONG (Reuters) - Asian shares rose on Friday as this week's sharp losses were seen as excessive, but a rally in oil fizzled and the yen edged up as signals flashed 'danger' for the global economy before the G20 meeting this weekend.

European shares were set to pick up the baton from Asia with Britain's FTSE 100 seen opening up as much as 3.9 percent and key indexes in Germany and France seen up more than 4 percent each.

But in a sign of how caution still remained, Asian shares pared earlier stronger gains, while U.S. Treasuries edged up amid doubts about the sustainability of the latest jump in equities.

"It's very underwhelming today," said Peter Wright, dealer at Burrell & Co in Australia.

"Ordinarily you might have expected the market to potentially be up the similar magnitude it was down yesterday, but this shows just how rattled investors are, which is very rattled."

The MSCI index of Asia-Pacific stocks outside Japan was up 1.6 percent at 6.55 a.m., marking its first gain in four sessions but paring gains earlier of as much as 3.2 percent.

Still, the index was down about 8 percent for the week as of late trade, and headed for its first weekly loss in three.

The gains came despite bleak signals on the global economy, which provide a bad omen for export-dependent Asia. Leaders of the Group of 20 industrialised and emerging nations will gather in Washington late on Friday to discuss the economic crisis.