* Expectations of further Fed action temper weak jobs report
* Asia ex-Japan equities up 0.6 pct at 3-month high
* IMM speculators increase bets against dollar to $15.5 bln
* US wheat prices down 4.5 pct on profit taking
By Kevin Plumberg
HONG KONG, Aug 9 (Reuters) - Asian stocks edged higher on Monday on growing speculation the Federal Reserve will have to buy bonds sooner rather than later to bolster the sagging economy, which is keeping the U.S. dollar under pressure.
Major European stock futures were up as much as 1.5 percent, reacting positively to a late session rally on Wall Street on Friday that saw major indexes cut earlier losses.
A steady flow of downbeat U.S. economic data, including disappointingly large job losses in July, has fueled expectations the Fed will have to take bolder action to stimulate growth, even with interest rates already near zero.
The central bank may signal a move is coming after a meeting on Tuesday.
The prospect of the Fed increasing the amount of cash floating around the financial system through purchases of U.S. bonds has been dragging on the dollar, but potentially stronger economic stimulus helped to buoy Asian equities on Monday.
"The market seems to be anticipating a shift in Fed policy towards renewed quantitative easing," said Andrew Pease, investment strategist, Asia Pacific for Russell Investments in Sydney.
"Against this backdrop, the relative resilience of Asia is probably a function of the better structural economic underpinnings in Asia ex Japan and perhaps some confidence that more aggressive QE by the Fed will eventually succeed."
The main event of the week will be the Fed's message on monetary policy on Tuesday. In addition, Chinese economic data this week are expected to confirm growth has plateaued for now, though exports and imports will still probably rise at a double-digit annual pace.
The MSCI index of Asia Pacific ex-Japan equities rose 0.6 percent to its highest since May 4.
Since June, the index has advanced 12 percent, exceeding an 8 percent gain on the all-country world index and a 5 percent rise in the U.S. S&P 500 index
Strength in emerging Asian equities is all the more striking since it has coincided with equity outperformance, a tell-tale sign that investors are focused on the region's relatively solid long-term growth prospects and healthier financial systems.
Japan's Nikkei share average fell 0.7 percent, however, as investors focused on the negative impact of a stronger yen on exporters. Electronics components maker Kyocera Corp stock fell 2 percent and was the biggest drag on the index.
UPTREND IN YEN
The U.S. dollar inched up 0.1 percent to 85.50 yen but was still within striking distance of a 15-year low of 84.81, below which dealers were concerned of possible government intervention to weaken the Japanese currency.
The yen gained around 5 percent against the dollar in the second quarter. So far in the current quarter it is up 3 percent, with an upward trend that has been brutal for exporters but a blessing for importers showing no signs of ending.
"After the poor jobs data, the focus is now on whether the Fed will further ease its monetary policy. The yen has already risen to around 85 yen (per dollar) on expectations that the Fed might do so," said Mitsuo Shimizu, deputy general manager at Cosmo Securities in Tokyo.
However, short-term investors should take heed. They have amassed a large collective bet against the U.S. currency, and usually such a big position is vulnerable to reversals.
Speculators on the International Monetary Market in the week ended Aug. 3 had a net short dollar position of $15.5 billion, the largest since December 2009.
Developed government bond prices ticked higher after a rally in U.S. Treasuries on Friday. At one point in that rally, speculation that the Fed will buy debt to pull down market rates knocked the U.S. 10-year yield to a 15-month low.
Ten-year Japanese government bond futures were up 0.3 points getting closer to a 7-year high hit last week. In the cash market, the 10-year yield fell 3.5 basis points to 1.02 percent moving closer to a seven-year low of 0.995 percent touched last week.
"Depending on what the Fed does at the meeting the 10-year yield could try for 0.95 percent. The 1 percent threshold is seen as less of a barrier now that it has been breached once," said Katsutoshi Inadome, a fixed-income strategist at Mitsubishi UFJ Morgan Stanley Securities in Tokyo.
U.S. Treasury futures were flat on the day
Commodities prices got a boost from continued dollar weakness. U.S. crude for September delivery rose 0.7 percent to $81.26 a barrel having risen 12 percent since June.
However, U.S. wheat prices fell 4.6 percent adding to a 7 percent decline on Friday.
Chicago wheat futures surged to a two-year high last week after Russia banned exports of the grain, which also fueled fears of a spike in food inflation, but profit taking has cooled prices since. (Additional reporting by Aiko Hayashi and Shinichi Saoshiro in TOKYO)