* European stocks up broadly, banks gain 3 percent
* Nikkei leads Asian stocks higher
* Bonds strong on talk of easier monetary policy
* Sterling, euro recoup just 0.4 percent
* Oil prices firm ahead of potential strike in Norway
By Patrick Graham
LONDON, June 29 (Reuters) - European and Asian stock markets
built on a recovery from the shattering aftermath of last week's
Brexit vote on Wednesday as investors wagered central banks
would ultimately ride to the rescue with more stimulus.
UK and European banks, a centre of concern since Britain
shocked global financial markets on Friday by voting to leave
the European Union, were broadly higher, extending a recovery
from two days of trading which knocked almost 40 percent off
Barclays (LON:BARC) and RBS (LON:RBS).
Sterling and the euro, the other big victims on Friday and
Monday, gained around 0.4 percent respectively against the
dollar. That put the pound 2 cents off Monday's 31-year lows
after falling some 18 cents from Thursday night.
Stock markets in Frankfurt, Paris and London all gained more
than 1.5 percent in early deals .FTEU3 while the pan-European
index of major banks was up 3 percent. .SX7E
Traders say the better mood was part the result of a swing
in expectations towards easier monetary policy over the next six
months, and part hopes that Britain will remain closely
integrated with Europe whatever deal is done.
"Expect lots of mood swings ahead as the prevailing mood
changes but there was definitely an air that full Brexit wasn't
necessarily a done deal yesterday," Deutsche Bank (DE:DBKGn) analyst Jim
Reid said in a morning note.
MSCI's broadest index of Asia-Pacific shares outside Japan
.MIAPJ0000PUS rose 1.0 percent to recoup around one-third of
Friday's stinging loss. Japan's Nikkei .N225 climbed 1.6
percent, while Australian stocks .AXJO added 0.8 percent.
Britain's 27 partners meet without on Wednesday the UK to
discuss how to respond to a Brexit and are expected to launch a
period of reflection, culminating in a set of EU reform
proposals to be unveiled by March of next year.
Yet Britain's course out of the EU remains unknown, leaving
the future of the entire bloc and its currency an open question.
"The only certainty in Europe is uncertainty," analysts at
ANZ said in a note.
"European leaders appear to want to move forward with Brexit
plans as quickly as possible, but political turmoil within
Britain suggests a quick turnaround is unlikely," they wrote.
Sterling, down as much as 9 percent in trade-weighted terms
on Monday compared to before the vote results, stood at $1.3397
GBP= , compared to the 31-year low of $1.3122. The euro rose to
$1.1064 EUR= , while the dollar steadied at 102.33 yen JPY= .
The first Federal Reserve policymaker to comment since the
vote, Governor Jerome Powell, said it had shifted global risks
"to the downside".
That only reinforced market expectations the Fed will no
longer be able to hike U.S. rates this year, and could even be
forced to cut if the domestic economy falters.
Japanese Prime Minister Shinzo Abe also urged the Bank of
Japan to provide ample funds to markets.
In commodity markets, gold was firmer XAU= around
$1,321.00 an ounce, off a low of $1,305.23 touched Tuesday.
Oil prices gained as a looming strike by Norwegian oil and
gas field workers threatened to cut output. There were also
reports oil producers and refiners in crisis-struck Venezuela
were struggling to keep output up.
U.S. crude oil futures CLc1 were up 59 cents at $48.44,
while Brent crude LCOc1 rose 53 cents to $49.11.