* Yen tumbles to 6-month low vs dollar on BOJ speculation
* Nikkei hits highest close in 6 years
* Aussie dollar edges to near 3-month low after RBA comments
* Gold stabilises after 2.6 pct slide overnight on strong
* European shares seen opening modestly lower
By Marc Jones
LONDON, Dec 3 World shares fell for a second day
and gold was near a five-month low on Tuesday, as concern the
U.S. will soon scale back its economic stimulus offset reports
that Japan would ramp up its own stimulus.
Upbeat U.S. economic data on Monday suggested the Federal
Reserve is tilting towards reducing its bond-buying programme.
Then signs the Bank of Japan will shovel more cheap money into
its economy saw the yen slide and pushed Japanese stocks towards
a six-year high.
European shares opened in no such mood, however. A
drop of 0.6 percent took their losses for the week to 1 percent,
as investors looked ahead to Thursday's ECB and BoE meetings and
Friday's key U.S. jobs data.
The euro was hovering at just over $1.35 and at a
5-year high versus the yen. Portugal's plans for a
debt swap to get in shape for a possible return to borrowing
markets next year dominated attention in bond markets.
"It is going to be interesting to see how the market reacts
to Portugal's debt exchange," said Suvi Kosonen, a fixed income
analyst for Nordea in Helsinki. "Most of the market attention,
though, is already turning to the ECB on Thursday and the U.S.
non-farm payrolls in the U.S. on Friday."
The interest in Portugal's debt swap meant Lisbon's stock
market and the country's government bonds
were virtually the only ones in Europe to sidestep losses.
Ukraine also remained in focus after massive protests
against President Viktor Yanukovich's decision to move away from
Europe towards Russia. Ukrainian financial markets got hammered
on Monday amid talk of a currency crisis.
Despite the turmoil, Yanukovich left Ukraine on Tuesday for
a state visit to China.
Investors otherwise remained fixated on Federal Reserve's
plans for winding down the stimulus programme that has helped
drive this year's huge rally in global risk assets.
U.S. 10-year Treasury yields, the benchmark for
the world's borrowing costs, were hovering just under the high
of 2.8 percent they hit on Monday after global data signalled
world growth was still gathering steam.
The U.S. Institute for Supply Management's index of national
factory activity rose in November to its best showing since
April 2011. Hiring also accelerated.
Friday's nonfarm payrolls report is expected to offer more
clues as to when the Fed will start reducing its monthly $85
billion bond purchases.
"A drop in the unemployment rate from 7.3 percent to 7.0
percent would fan tapering fears, preventing U.S. Treasuries
from reversing course even on a lacklustre 150k NFP," Societe
Generale said in a note.
With the U.S. Treasury yields moving higher, so did the
appeal of the dollar. It hit a six-month high of 103.38 yen
and sat just short of a 4 1/2-year high reached in May.
The yen was also weighed down by the speculation that the Bank
of Japan may expand its already massive stimulus.
According to officials briefed on the process, the bank is
looking to go beyond its $70 billion-a-month bond-buying
programme. Options include major purchases of
stock-market-linked funds or other assets riskier than Japanese
government bonds, the insiders said.
AUSSIE DOLLAR DOWN
Despite robust export numbers and strong retail data, the
Australian dollar dropped towards a three-month low
after the Reserve Bank of Australia left rates on hold and said
the currency was "still uncomfortably high."
Gold, meanwhile, traded near a five-month low amid the fears
of an early end to Fed stimulus, and the metal looked vulnerable
to further declines with the jobs data looming.
Spot gold saw a small rebound to $1,222 an ounce in
early trading in London following Monday's 2.6 percent fall, but
it remained close to its lowest levels since early July.
U.S. crude prices gained 0.2 percent to around $94 a
barrel, adding to a 1.2 percent rise overnight. Brent
inched up to $111.50.