* Oil shares under pressure as European stocks turn lower
* U.S. crude hits 6 1/2-year low
* Greek parliament approves third bailout
* Euro zone GDP falls short
By Jamie McGeever and Alistair Smout
LONDON, Aug 14 (Reuters) - European stocks were poised for
their worst week in six on Friday, under pressure from a falling
oil price, as global markets struggled to regain poise after
China's surprise currency devaluation on Tuesday.
Markets rose briefly on Friday, with European stocks and the
euro both supported in early deals after Greek parliament
approved a third multi-billion euro bailout deal.
However, investors were underwhelmed by weaker-than-expected
euro zone economic growth figures, and market sentiment remained
fragile.
Oil slumped to its lowest since March 2009 and emerging
market currencies - notably the Turkish lira and South African
rand - slid to historical lows.
The FTSEurofirst 300 index of leading European shares gave
away early gains to trade down 0.2 percent 1040 GMT. The Euro
STOXX 50 .STOXX50E traded down 0.7 percent, weighed down by a
1 percent fall in oil and gas shares.
Before Wall Street's open, U.S. stock futures ESc1 were
down 0.2 percent.
European stocks were poised for a weekly loss of 3 percent,
their biggest loss in six weeks. A close of 3.5 percent on the
week would be the biggest decline this year.
European equities have been under pressure from a falling
yuan, which has hit auto stocks, miners and luxury firms.
However, some said the drop had gone too far.
"We think it plausible that European equity markets have
reacted too negatively to the 4 percent depreciation of the
yuan," strategists at Morgan Stanley (NYSE:MS) said in a note.
"Any indications that China may introduce a wider stimulus
program could shift sentiment from risk-off to risk-on as
investors consider the potential for better global growth."
Earlier on Friday, the Greek parliament voted to approve the
country's third financial rescue by foreign creditors in five
years. Prime Minister Alexis Tsipras still faces a confidence
vote later this month. ID:nL5N10P15H
Meanwhile, official figures showed that the German and
Italian economies expanded more slowly than expected in the
second quarter. The French economy didn't grow at all.
ID:nL5N10P0UP ID:nL5N10P0FH ID:nR1N0QW02N
OIL NOT SO SLICK
In commodities trading, crude oil futures extended sharp
losses that pushed oil prices to levels not seen since early
2009, when the financial crisis was wreaking havoc on markets.
U.S. crude CLc1 fell to a new 6 1/2-year low of $41.35 a
barrel, as a big increase in U.S. stockpiles intensified worries
over a growing global glut. It was last down 0.1 percent at
$42.14 a barrel. Brent LCOc1 was flat at $49.21.
In Asia, MSCI's broadest index of Asia-Pacific shares
outside Japan .MIAPJ0000PUS slipped 0.1 percent, ending the
week down 2.7 percent, its biggest weekly loss since early July.
Japan's Nikkei stock index .N225 fell 0.4 percent, and was
down about 1 percent for the week.
The People's Bank of China set its midpoint yuan rate
CNY=SAEC at 6.3975 per dollar before the market opened, firmer
than the previous day's close of 6.3990. The yuan also
strengthened in spot market trading CNY=CFXS , changing hands
at 6.3918 late in the Asian session.
But over the week, the yuan lost nearly 3 percent after the
central bank's devaluation on Tuesday and pledge to allow market
forces to play a greater role in setting the exchange rate.
"We just need to see if the yuan is going to stay halfway
stable over the next few days, then confidence is going to come
back," said Markus Huber, senior equity sales trader at
Peregrine & Black.
"If China calms down, we're going to have the potential for
a rate hike in the U.S. on the table again, and that could be
the next drag on markets."
The dollar was largely steady against its main rivals on
Friday. It fell 0.2 percent against the yen at 124.15 yen
JPY= , off its two-month high of 125.28 on Tuesday. The euro
rose 0.2 percent to $1.1167 EUR= and is up 1.8 percent this
week.
The greenback came under pressure this week as China's
devaluation curbed expectations the Federal Reserve's
long-awaited interest rate increase would come as early as its
Sept. 16-17 meeting. But strong U.S. retail sales data on
Thursday backed the view that the Fed was ready to hike.
The yield on 10-year U.S. Treasury notes was roughly steady
on the day - and the week - at 2.17 percent US10YT=RR , having
fallen to a near four-month low of 2.04 percent on Wednesday.
Gold was flat on the day but up 2 percent on the week, its
best weekly performance in three months XAU= .