Stocks rose on Friday and the euro steadied on hopes that a fractious European Union will agree on a bailout package for Greece within days as it struggles to keep the debt crisis from spreading to other weak countries. Shares were also buoyed by strong earnings reports from major U.S. companies, which pushed up Wall Street stocks and bolstered hopes that the world's largest economy was picking up steam, tempering worries about weakness in Europe.

Hopes that the fractious European Union will agree on a bailout package for Greece as soon as Monday and prevent the debt crisis from taking down other weak countries such as Spain and Portugal kept the euro steady at $1.3237.

That helped support commodity prices, with gold spiking to the year's highs.

The optimism looks set to carry over in European trade, with Britain's FTSE 100 <.FTSE> and Germany's DAX <.GDAXI> seen opening slightly higher, while France's CAC-40 <.FCHI> was seen mixed.

The Greek situation is well flagged and well known, said Alex Boggis, director of Aberdeen Asset Management in Hong Kong. In the short term, no one is immune to bad news, but in the long term, Asia is much better off.

Asian shares outside of Japan <.MIAPJ0000PUS> rose 0.8 percent, and were on track for a 0.8 percent gain on the month.

Underscoring investor confidence in Asia, Indonesian stocks <.JKSE> climbed 0.9 percent to a record high.

Japan's Nikkei <.N225> rose 1.2 percent after being shut for a holiday on Thursday, and Hong Kong's Hang Seng Index <.HSI> climbed 1.1 percent after three sessions in the red, as selling pressure eased on Europe's largest lender HSBC <0005.HK>.

HSBC rose 1.5 percent amid hopes that Greece could avert a disastrous default.

We should see some long-term capital coming back to stocks now that worries over Greece are easing, said Francis Lun of Fulbright Securities.

Indeed, data from fund tracker EPFR showed suggests investors are anything but risk averse as they pour more money into emerging market equity and debt funds.

The data showed even Greek equities managed to pull in a net $3.75 million, a paltry sum, but still notable given Greece's sovereign rating was downgraded to junk status on Tuesday.

To be sure, there was a steady flow of positive news out on Friday to encourage investors.

Samsung Electronics Co Ltd <005930.KS>, the world's top maker of memory chips and flat screen televisions, predicted record profits. Its shares rose 3.2 percent.

Billionaire Warren Buffett also said in an interview with Fox Business Network that Berkshire Hathaway Inc had a big upswing in all of its U.S. and Asian businesses since March.

U.S. data out on Friday may support Buffett's remarks.

Data is expected to show a resurgence in U.S. consumer spending that would put the world's biggest economy on a path of sustainable recovery, even though growth probably slowed in the first quarter.

HIGHLY FLUID

Still, the currency market does not seem to be wavering from its heavy bets against the euro.

Traders said they were still bearish on the common currency, noting that Greece faced a painful, multi-year crisis which is likely to test EU unity repeatedly.

Even if the rescue package is convincing, markets will remain worried about other heavily indebted EU members such as Portugal and Spain.

German politicians have said the bailout could be worth 100-120 billion euros ($133-160 billion) over three years, two to three times the size of an original rescue plan for aid in 2010.

The situation ... remains highly fluid with FX markets trading on headlines as they hit the wires, JP Morgan said in a note.

We remain cautious in our view toward the euro precisely for this reason but remain more confident in being short where there is a strong macro fundamental reason to do so.

The euro hovered at $1.3260, from $1.3242 late in New York on Thursday. For the month, the euro lost 2 percent, its fifth consecutive month of losses.

Economists said euro zone states could end up footing a bill of half a trillion euros ($650 billion) to save several nations if they fail to calm markets with a Greek bailout.

Germany in particular has baulked at helping out less fiscally responsible EU members.

Sterling, the other major currency that has suffered a sharp selloff this year, managed however to rise 1.1 percent in April. Still, worries that Britain may be stuck with a hung parliament after next week's elections could cap gains in coming days.

The pound was at $1.5364, up from $1.5322 in NY.

U.S. crude oil futures extended gains above $85 a barrel as the euro continued to gain against the dollar, lowering costs for market players who use the currency to trade the dollar-denominated commodity.

Gold spiked just over 1 percent to around $1,173 an ounce on signs investors were plowing more capital into bullion markets to hedge against problems in Europe.

The dollar was little changed against a basket of major global currencies.

(Additional reporting by Anirban Nag)

(Reporting by Koh Gui Qing in Sydney and Kim Coghill in Singapore; Editing by Sugita Katyal)

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