* Central bank mops up $17.2 mln via repos * Euro woes to weigh on shilling, stocks * StanChart, Barclays, Uchumi lift bourse (Adds markets close, stocks) By Kevin Mwanza and Duncan Miriri NAIROBI, May 18 (Reuters) - The Kenya shilling extended its losses against the dollar on Friday on importer orders for the latter, but traders said they expected the central bank to keep supporting the currency, while stocks rose for the seventh straight session. At the 1300 GMT market close, banks quoted the shilling at 84.50/70 per dollar, 0.3 percent weaker than Thursday's close of 84.25/45. "We might hold at this level because the central bank looks keen to support the shilling," said John Muli, a trader at Africa Banking Corporation. The central bank sought to absorb 7 billion shillings ($83 million) via repurchase tenders (repos), received bids worth 1.45 billion and accepted them all at a weighted average interest rate of 17.6 percent. The bank has been in the market selling unspecified amounts of dollars directly to commercial banks and soaking up liquidity to prevent the shilling from falling drastically. The regulator was forced to tighten liquidity aggressively to stabilise the shilling late last year, after the local currency tumbled through a series of record lows, causing widespread condemnation of its monetary policy stance. Traders said the short-term outlook was for the shilling to weaken as Treasury bill yields fall towards single digits, last seen in September, reducing their attractiveness to offshore investors, while liquidity increases due to debt redemptions. They said charts showed a base had formed at 84.20 and the globally stronger dollar was set to gain ground against the local currency. The U.S currency has strengthened as investors move out of riskier assets such as the shilling due to the deepening turmoil in Greece and fears of contagion spreading to other stressed euro zone economies. On the Nairobi Securities Exchange, the benchmark NSE-20 Share Index rose 0.6 percent to 3,699.69 points, buoyed mainly by Standard Chartered Bank (StanChart), Barclays and retailer Uchumi. StanChart added 4 percent to 180.00 shillings and rival Barclays rose nearly 3 percent to 13.90 shillings per share on strong first-quarter profits released this week. The bourse's biggest gainer this year, retailer Uchumi , jumped 4 percent to close at a fresh 6-year high of 18.05 shillings - a level it last touched before it was suspended from the bourse in 2006 for insolvency. The shares were re-admitted to the bourse last year. "Uchumi still has a good story. Ciano (chief executive officer) has given shareholders confidence there is value in the company going forward," said Reginald Kazdutu, fund manager at Amana Capital. Shares on the bourse have rallied 14 percent this year, but traders said the main risk to the rally was an escalation of the debt crisis in the euro zone because of Kenya's trading connections with Europe. In the debt market, government and corporate bonds worth 1.3 billion shillings were traded, down from 4.6 billion shillings on Friday, with most activity being around the 12-year infrastructure bond, which traded with a yield of 12.8 percent.

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