* Asia stocks snap 6-day winning run
* S.Korea exports data grim; Chinese manufacturing slumps
* Major central bank rate cuts eyed this week
* Yuan tumbles on speculation of currency policy shift
(Recasts, adds European stocks outlook)
By Eric Burroughs
HONG KONG, Dec 1 (Reuters) - Asian stocks dipped on Monday
to snap a six-day winning streak, with investors caught between
aggressive steps by central bank to alleviate the sharp global
downturn and increasingly grim economic data.
Higher-yielding currencies such as the Australian dollar
fell ahead of rate cuts expected this week, while oil prices
shed more than a $1 after cartel OPEC delayed a third supply
cut to later in the month.
Major central banks from Australia to Europe are seen
slashing interest rates deeper this week in a string of policy
meetings, marking the latest chapter in official efforts to
limit the economic fallout from the 15-month credit crisis.
European shares were seen mixed at the start, with
financial bookmakers calling for a more than 1 percent rise in
Britain's FTSE 100 <> but a drop in Germany's DAX
<>.
Stocks around the world recovered last week after the U.S.
government rescued banking giant Citigroup <C.N>, the Federal
Reserve said it would buy up to $800 billion debt to help
households access credit and China slashed rates.
Portfolio managers are grappling with whether the sell-off
across equity markets has adequately anticipated the drop in
corporate profits from the sharp economic downturn, or whether
a further slide is in the offing.
"The market is still tentative because of potential profit
downgrades and bad economic news will probably outweigh for a
while," said Hans Kunnen, head of investment market research at
Colonial First State Investments in Sydney.
The MSCI index of Asia-Pacific stocks outside Japan
<.MIAPJ0000PUS> inched down 0.3 percent but is up 18 percent
from a five-year low hit last month. For the year, the index
has plunged 57 percent.
In a positive sign for Asian stocks, investors have started
shifting funds into equities. Data from EPFR Global showed
Asian ex-Japan stocks posted a second straight week of fund
inflows in the week ending last Wednesday.
Japan's Nikkei average <>, however, fell 1.4 percent
as some investors booked profits after markets rose nearly 8
percent last week.
Hong Kong's Hang Seng index <> was the best performer
in the region, rising 1.8 percent. Exporter shares helped lift
the market on reports of brisk holiday spending in the United
States.
Trading volume was subdued as U.S. investors gradually
returned to their desks following the Thanksgiving holiday.
BLEAK DATA
Data on Monday showed South Korean exports plunged 18.3
percent in November from a year earlier, the sharpest fall in
seven years. []
A gauge of manufacturing activity in China showed the
sharpest monthly contraction in its 4-1/2-year history on
plunging new orders for export goods. []
The yuan slid on market talk Chinese authorities might
tweak foreign exchange policy to stimulate the economy, with
the central bank's mid-point for the currency set 0.23 percent
weaker at 6.8505 per dollar <CNY=CFXS> -- the biggest drop
since May.
Markets looking ahead to a batch of closely watched figures
in the United States this week, with the Institute for Supply
Management's factory index expected to show activity shrinking
at the fastest pace since the early 1980s.
Improved fund flows into equities may help buoy beleaguered
Asian currencies. The South Korean won rose 2 percent to
1,439.9 to the dollar <KRW=> despite the downbeat trade
figures.
The yen edged up as investors trimmed higher-yielding
currencies. The dollar dipped 0.2 percent to 95.25 yen <JPY=>.
The Australian dollar shed 1.5 percent to $0.6455 <AUD=D4>
before an expected rate cut by the country's central bank, with
some traders eyeing a full percentage point slash.
Safe-haven government bonds slipped after gains in most
stock indexes.
The 10-year Japanese government bond yield <JP0YTN=JBTC>
rose 1.5 basis point to 1.395 percent, while the 10-year
Treasury yield <US10YT=RR> was steady at 2.925 percent after
initially dipping to a 50-year low of 2.890 percent.
(Editing by Anshuman Daga)
