RTRS:GLOBAL MARKETS-Stocks fall, dollar up after death of Kim Jong-il
* MSCI Asia ex-Japan falls as much as 2.9 pct on Kim Jong-il death
* Dollar index gains as much as 0.3 pct on safe-haven appeal
* South Korean won falls 1.8 pct, CDS spreads widen
* Euro down 0.5 pct to $1.2985 on downgrade worries
* European shares seen opening lower
By Chikako Mogi
TOKYO, Dec 19 (Reuters) - Asian equities and U.S. stock index futures fell, with South Korean shares tumbling as much as 5 percent, while the dollar gained on safe-haven appeal after news of the death of North Korea leader Kim Jong-il raised fears of regional instability.
The Korean won fell 1.8 percent on the news, announced at 0300 GMT, which financial markets fear could mean instability in northeast Asia because of the unpredictability of a leadership transition in the impoverished, secretive North.
Commodities also fell broadly, as investors reacted by shedding riskier assets in favour of the safe-haven dollar. "The risk or fear that the death of Kim Jong-il will lead to provocation by North Korea is pressuring selling," said Hiroyuki Fukunaga, CEO of Investrust, in Tokyo. "Right now, there's going to be a sell-off as part of a risk-off."
The key focus will be how the succession proceeds.
"It is hard to predict how things in North Korea will develop from here this time. The news comes at a time when financial market had already been in fragile shape," said Bae Sung-young, a market analyst at Hyundai Securities.
MSCI's broadest index of Asia Pacific shares outside Japan extended losses to slide as much as 2.9 percent, while South Korea's benchmark index was down 3.4 percent, having fallen as much as 5 percent earlier.
European shares were expected to open lower, with financial spreadbetters calling London's FTSE to start down 0.9 percent, Frankfurt's DAX down 1.9 percent, and Paris' CAC-40 1.8 percent lower.
Japan's Finance Minister Jun Azumi said he was monitoring financial market moves after the news, which put regional powers on edge over what might happen next in the isolated state, whose collapsing economy and bid to become a nuclear weapons power pose major threats to northeast Asia.
Tokyo's Nikkei share average ended down 1.3 percent, while the dollar jumped 0.5 percent against the yen, before paring gains a little, and S&P 500 futures fell 0.6 percent. The dollar rose as much as 0.3 percent against a basket of six key currencies.
