* Asia mixed as Wall St bull run stumbles over profit-taking
* Nikkei hit by firmer yen, steep slide in Toshiba stock
* Dollar eases back, yield gap keeps euro restrained
* Treasuries get rare rally after 5yr sale draws strong
* Oil eases after surprise rise in U.S. inventories
By Wayne Cole
SYDNEY, Dec 29 Asian shares were subdued on
Thursday after Wall Street suffered a mild setback after weeks
of gains, while a pullback in U.S. yields prompted year-end
profit taking in the dollar.
Japan's Nikkei shed 1.3 percent as the yen firmed
and Toshiba Corp dived 16 percent after news of
potential massive writedowns led to a downgrade of its credit
S&P said it expected shareholder equity to "drastically
shrink", eroding the conglomerate's financial resilience.
Moves elsewhere were more modest. Australia's main index
recouped early losses to finish flat at a 17-month peak,
while stocks in Shanghai added 0.2 percent.
MSCI's broadest index of Asia-Pacific shares outside Japan
was last up 0.19 percent.
The pullback on Wall Street came amid light volumes and
likely reflected caution about what the New Year might bring,
given Wednesday was the first session when trades actually
settle in January.
The Dow fell 0.56 percent, while the S&P 500
lost 0.84 percent and the Nasdaq 0.89 percent. Boeing
fell 0.9 percent after Delta Air Lines cancelled
a $4-billion order for 18 Dreamliner aircraft.
Technology was the largest weight on major indexes, with
Nvidia down 6.9 percent after short seller Citron
Research said the market was overlooking the headwinds for the
stock - which had earlier touched a record high.
Weak home sales data were blamed for some of the selling,
though normally this series barely gets a mention in markets.
Contracts to buy previously-owned U.S. homes fell in
November to their lowest level in nearly a year, a hint of how
rising mortgage rates could weigh on the housing market.
U.S. bonds made a rare rally as the soft report combined
with surprisingly strong demand for a sale of new five-year
Treasury notes. Yields on 10-year paper fell to their lowest
levels in two weeks to around 2.492 percent.
Yet euro zone yields were also falling on concerns about the
strength of a rescue plan for Italian banks and normal year-end
Germany's 10-year yields hit their lowest in
seven weeks at 0.181 percent, while their discount to Treasury
yields reached the widest on record.
The ever-widening yield gap kept the euro restrained around
$1.0450, after touching an eight-session trough of
$1.0372 overnight. Sterling was also soft at $1.2243
after hitting its lowest in two months.
The dollar eased 0.5 percent on the yen to 116.75,
but was still up 12 percent over the past two months.
In commodity markets, oil came off the boil after data
showed a surprise build in U.S. crude inventories. U.S. crude
fell 26 cents to $53.80 a barrel, while Brent was
last quoted down 4 cents at $56.18.
(Editing by Simon Cameron-Moore and Eric Meijer)