UPDATE 3-Chinese industry on more solid ground, surveys show

* China manufacturing surveys suggest recovery sustainable

* Output at year high, overseas orders at 11-month high

* Markets wary of signs of green shoots in Japan (Adds comments by c.bank adviser, economists, market reaction)

By Alan Wheatley and Simon Rabinovitch

BEIJING, July 1 (Reuters) - China's manufacturing sector extended a steady if unspectacular recovery in June, surveys released on Wednesday showed, adding to evidence across Asia that the regional economy is finally pulling out of a deep dive.

"I believe the current recovery has been confirmed and can be sustained," Fan Gang, an economist who advises the central bank, told a financial forum.

Fan predicted China's exports will be growing again, from a low base, by the end of the year. [ID:nPEK153534]

The official purchasing managers' index (PMI) for June rose to 53.2 from 53.1 in May, consolidating for the fourth month in a row above the watershed mark of 50.

A companion index compiled for brokerage CLSA improved to 51.8 from 51.2, its third month in positive territory, as output grew at the strongest rate in a year and overseas orders rose for the first time in 11 months. [ID:nBJB000639]

A reading over 50 indicates an expansion in manufacturing sector, while one below 50 suggests contraction.

"We take it as signalling that the green shoots of economic recovery have taken root and are likely to blossom in the second half of 2009," Steven Zhang and Qing Wang at Morgan Stanley said in a note to clients.

Beijing responded to last autumn's slump in global demand with a massive 4 trillion yuan ($585 billion) stimulus package, ultra loose credit policy and an array of tax breaks.

Alongside improvements in other timely data such as power consumption, tax revenues, industrial profits and cars sales, Wednesday's reports indicate that the pump-priming is working.

For a graphic on China's PMI trends, click on: here

GLIMMERS OF HOPE

China accounts for only 7 percent of global output at market rates, so it cannot be expected to haul the rest of the world out of recession. But global investors have responded positively to the improved news flow recently out of Beijing.