* Chinese stocks tumble, with CSI300 index hitting 4-mth low
* Dollar scales more than 5-yr high vs yen
* Asian ex-Japan shares steady, Nikkei ekes out slim gain
* S&P cuts European Union debt rating to AA-plus from AAA
* Indonesian rupiah slumps to 5-yr low; baht, ringgit also
By Dominic Lau
TOKYO, Dec 20 Chinese stocks stumbled on Friday
on concerns over a renewed cash crunch, while Asian shares crept
higher as investors reassessed the Federal Reserve's policy
outlook after it decided this week to start tapering stimulus.
The dollar climbed on the Fed tapering news to a more than
five-year high against the yen, and stood tall against the euro
and emerging currencies, while gold rebounded after earlier
tumbling to a near six-month low.
China's benchmark money market rate climbed to a six-month
high despite attempts by the People's Bank of China to calm
sentiment, showing signs of a scramble for cash reminiscent of a
massive crunch that occurred in June.
China's CSI300 stock index shed 2.2 percent after
earlier hitting a four-month low, while shares of Hong
Kong-listed Chinese companies sagged 1.7 percent.
"Liquidity is an issue," said Jackson Wong, Tanrich
Securities vice-president for equity sales in Hong Kong.
"Even after the PBOC announced the short-term liquidity
operation last night, there is still a concern in the short term
because if the markets don't hear guidelines from PBOC
officials, banks are still in the tight mode."
Financial bookmakers expected UK, Germany and French stocks
to open up as much as 0.4 percent on Friday.
But their opening calls were made before ratings agency
Standard & Poor's cut its supranational long-term rating on the
European Union by one notch to AA-plus, citing rising tensions
on budget negotiations and following cuts to the ratings of
member states in recent months.
ASIAN SHARES TENTATIVE
MSCI's broadest index of Asia-Pacific shares outside Japan
was little changed.
Tokyo's Nikkei benchmark erased earlier losses to
end 0.1 percent higher, marking its highest closing level in six
years for a second day in a row. The Bank of Japan, as widely
expected, stood pat on its monetary policy after a two-day
Analysts said the Fed's smooth start in cutting its stimulus
by $10 billion to $75 billion a month without disrupting markets
removed one uncertainty for the BOJ, giving it more time to
decide whether further monetary expansion will be needed next
The yen fell to its weakest level of 104.60 yen to the
dollar since October 2008, while the euro eased 0.2
percent to $1.3637, hitting a two-week low.
Against a basket of major currencies, the dollar was
up 0.1 percent at 80.735, a two-week high.
"With the Fed now having begun the tapering process, the
burden of proof now seems to be on the side of the data to
weaken sufficiently to force a halt," analysts at BNP Paribas
wrote in a note.
Thursday's data showed U.S. home resales hit a near one-year
low in November and new filings for unemployment benefits
unexpectedly rose last week, dulling an otherwise brightening
Overnight, U.S. stocks finished mostly flat as investors
paused after a rally in the previous session, though the Dow
Jones industrial average closed at its second record high
in a row. U.S. S&P 500 E-mini futures inched up 0.1
percent in Asian trade on Friday.
Fears of renewed capital outflow put emerging currencies
under pressure. The Indonesian rupiah slumped into a
five-year trough of 12,250 per dollar on Friday, while the Thai
baht touched a three-year low of 32.57 to the dollar
and the Malaysian ringgit fell 0.3 percent to 3.285, a
Among commodities, U.S. crude prices slipped 0.3
percent to $98.77 a barrel, paring some of Thursday's 1 percent
rise on the back of U.S. refinery oil demand to meet robust
Gold rebounded 0.4 percent to $1,194.59 an ounce
after earlier hitting a near six-month low of $1,185.30. The
precious metal slumped 2.3 percent overnight, and is down nearly
29 percent this year, heading for its worst annual decline since