By Lisa Twaronite and Hideyuki Sano
TOKYO (Reuters) - Asian shares fell to 10-week lows on Tuesday as investors braced for a possible hawkish shift in the Federal Reserve's policy stance in the lead-up to the U.S. central bank's two-day policy meeting later in the day.
Financial spreadbetters predicted a brighter opening in Europe, expecting Britain's FTSE 100 to open 6 to 8 points higher ahead of Thursday's vote on Scottish independence, and France's CAC 40 to open 2 to 3 points higher, for a gain of 0.1 percent for each. Germany's DAX was seen opening 3 to 4 points higher, or flat on the day in percentage terms ahead of the ZEW investor confidence survey.
"Still clouded by the prospects of an independent Scotland, markets in Europe look set for a slightly higher start ahead of UK inflation, German investor confidence and an increase in telecoms merger activity," Jasper Lawler, market analyst at CMC Markets, said in a note to clients.
MSCI's broadest index of Asia-Pacific shares outside Japan shed 0.6 percent to its lowest level since late June. Japan's Nikkei stock average snapped a five-session winning streak to close down 0.2 percent, catching up after Tokyo markets were closed for a local holiday on Monday.
Speculation that the Fed could raise interest rates sooner and faster than previously expected has rattled many share markets around the globe and supported the U.S. dollar.
The Fed's Open Market Committee will begin its regular two-day policy meeting later on Tuesday, and investors will be scanning the outcome for clues on the timing of the first U.S. rate hike in more than eight years.
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U.S. central bank policymakers will also release fresh economic and interest-rate projections, extending their forecast horizon through 2017.
They have said they do not expect to raise rates until 2015, but recently strong U.S. economic data has led Fed officials to acknowledge they may need to act sooner than they thought just a few months ago.
"At Wednesday's FOMC meeting, changes to Fed forecasts and wording that reflects expectations that rates could go higher sooner than expected should provide support" to the U.S. dollar, strategists at Barclays said. "We also look for a modest steepening in the median policy path and more clarity on exit principles."
Wall Street had a mixed session on Monday after weekend data showed China's factory output in August grew at its slowest pace in nearly six years, raising fears the world's second-largest economy was losing momentum.
"The fall in the real estate sector activity is affecting output. Everyone knows August is pretty weak, so if things improve in September, that would reassure investors," said Hirokazu Yuihama, senior strategist at Daiwa Securities.
The dollar index, which tracks the greenback against a basket of six major rivals, was steady on the day at 84.294, not far from its 14-month peak of 84.519 scaled a week ago.
Keeping pressure on the euro, the Organisation for Economic Cooperation and Development projected lower growth for major economies on Monday and urged much more aggressive stimulus from the European Central Bank to ward off the risk of deflation.
The euro edged down slightly to $1.2935, while the dollar added about 0.1 percent against its Japanese rival to 107.27 yen, not far from a six-year high of 107.39 yen touched on Friday.
The yield on the benchmark 10-year U.S. Treasury note stood at 2.572 percent in Asia, compared with Monday's U.S. close of 2.591 percent. It hit a two-month high of 2.651 percent on Monday, before paring its rise on news of a drop in last month's U.S. manufacturing output.
U.S. crude lost about 0.3 percent to $92.66 a barrel, pressured by the weekend data from China that cast doubt on the strength of global demand. On Monday, the expiring Brent contract for October dropped to its lowest price since July 2012, while the new front-month contract steadied in Asian trade to $97.90.
Spot gold edged up on the day to $1,235.30 an ounce, supported by the Chinese data but undermined by expectations that the Fed will start hinting at interest rate hikes. On Monday, it fell to its lowest level since January.
(Additional reporting by Thuy Ong in Sydney; Editing by Eric Meijer)