Corrected - Asian shares tiptoe up, U.S. bonds fall after Fed taper

(Corrects milestone on yen to more than 5-year low in eighth paragraph)

By Dominic Lau

TOKYO (Reuters) - Asian shares got off to a cautious start on Friday tracking a more circumspect session on Wall Street overnight, as investors reassessed the Federal Reserve's policy outlook following its decision this week to start tapering its massive stimulus.

U.S. government bond prices fell on emerging doubts about the Fed's commitment to rock-bottom interest rates.

Gold tumbled to a near six-month low, extending months of weakness after the U.S. central bank finally scaled back its stimulus that has pushed the precious metal to record territory in recent years. Gold is on track for its worst yearly decline since 1981.

MSCI's broadest index of Asia-Pacific shares outside Japan added 0.1 percent after ending a touch softer in the previous session.

In Tokyo, Nikkei futures were up slightly, indicating a modest gain for the benchmark Nikkei <.N225> ahead of the outcome of a two-day Bank of Japan policy meeting.

The Nikkei rallied 1.7 percent to its highest closing level in six years on Thursday as the yen slid after the Fed's taper decision.

Analysts said the Fed's smooth start in trimming 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 year.

The yen was steady at 104.24 yen to the dollar in early Asian trade, hovering near a more than five-year trough for a second day after having fallen 1.6 percent on Wednesday following the Fed announcement.

The euro languished near a two-week low at $1.3657.

"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 economic picture.

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 early Asian trade on Friday.

The 10-year U.S. Treasury yield jumped as high as 2.9512 percent on Thursday, hitting a three-month peak.

Deutsche Bank analysts said they expected the U.S. unemployment rate to fall faster than the Fed projections and the risk was that inflation pressures would start to mount earlier than the U.S. central bank anticipated.

"They will not be able to follow the very gradual path of rate hikes the market expects," they said in a report.

In a move likely meant to pre-empt any sharp market reaction that could undercut the recovery, the Fed also said in its tapering announcement that it "likely will be appropriate" to keep overnight rates near zero "well past the time" that the U.S. jobless rate falls below 6.5 percent.

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BOJ and Fed asset buying: http://link.reuters.com/qyt65s

Asset returns in 2013: http://link.reuters.com/dub25t

Australia IPOs: http://link.reuters.com/zuf55v

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Among commodities, U.S. crude prices edged down 0.1 percent to $98.68 a barrel, pausing after Thursday's 1 percent rise on the back of U.S. refinery oil demand to meet robust distillate exports.

Gold hit a near six-month low of $1,185.30 an ounce on Friday, extending a 2.3 percent slide overnight. The yellow metal is down 29 percent, heading for its worst annual decline since 1981.

(Editing by Shri Navaratnam)