* Nikkei highest since 1996, yen down after Abe wins election
* Euro eases as Spain struggles with Catalan issue
* Dollar, Wall St supported by progress on U.S. tax cuts
* Oil gains on supply concerns, gold pressured by US dollar
By Wayne Cole
SYDNEY, Oct 23 (Reuters) - Japanese shares jumped on a weaker yen on Monday as an election win for Shinzo Abe's ruling bloc gave a green light for more policy stimulus, while the euro eased as Spain's constitutional crisis aggravated concerns about political unity in the region.
The U.S. dollar was the major beneficiary as President Donald Trump and Republicans took a small step toward tax cuts, boosting Wall Street stocks and lifting bond yields.
Japan's Nikkei raced up 1 percent to its highest since 1996 after Prime Minister Abe looked to have easily won in national elections over the weekend.
MSCI's broadest index of Asia-Pacific shares outside Japan held steady, while Singapore's main index reached its highest in over two years.
Investors assumed Abe's victory would allow the Bank of Japan to continue with massive monetary easing that depresses bond yields and the yen, even as the U.S. Federal Reserve seems determined to hike rates again in December.
"This should extend the lifespan of 'Abenomics', including the BOJ's mega stimulus," wrote analysts at the Blackrock Investment Institute.
"We see the outcome as a mild positive for Japanese equities, and as a mild negative for the yen and Japanese government bonds."
The dollar rose 0.2 percent to 113.74 yen and briefly touched its highest since mid-July at 114.09. It faces stiff resistance at the July top of 114.49, but a break would open the way to its March peaks around 115.51. Against a basket of currencies, the dollar edged up 0.1 percent.
The yen even slipped against the euro, which was having its own troubles as the Spanish government urged Catalans to accept its decision to dismiss their secessionist leadership and to take control of the restive region.
The nation's biggest political crisis in decades enters a decisive week as Madrid tries to impose its control, although investors have so far assumed the political strife would not spread to elsewhere in the European Union.
The euro eased only a modest 0.13 percent on Monday to $1.1770 and has strong chart support around $1.1729.
The single currency faces another hurdle on Thursday when the European Central Bank holds a policy meeting amid much talk it will cut back the amount of assets it buys every month, but also extend the programme.
"As we have argued for some time now, the length of time the (quantitative easing) programme runs for matters more than monthly size," said analysts at RBC Capital Markets.
"So while we look for a reduction by at least 30 billion euros in net terms ... we also expect that the ECB will keep the programme open ended."
Asian share markets caught some tailwind from Wall Street's record finish on Friday when the passage of a U.S. Senate budget resolution bolstered speculation that President Trump's tax-cut plan may move forward.
The Dow ended Friday with gains of 0.71 percent, while the S&P 500 rose 0.51 percent and the Nasdaq 0.36 percent.
In commodity markets, a firmer dollar nudged gold down 0.3 percent to $1,276.80 an ounce.
Oil prices edged ahead on supply concerns in the Middle East and as the U.S. market showed further signs of tightening while demand in Asia keeps rising.
Brent crude rose 13 cents to $57.88 a barrel, while U.S. crude futures added 25 cents to $52.09.
Editing by Peter Cooney and Sam Holmes