GLOBAL MARKETS-Oil hits 6-month high, Nikkei tumbles on Syria worries
* Brent crude climbs to 6-month peak, gold near 3-month high
* Asian shares extend slide, Nikkei hits 2-month low
* Yen holds near 1-week high against dollar, euro
TOKYO, Aug 28 (Reuters) - Jitters over a possible U.S.-led military strike against the Syrian government knocked Asian equities on Wednesday, with Japan's Nikkei hitting a two-month low, and pushed oil prices and safe-haven gold to multi-month highs.
An acute 'risk-off' mode also boosted the appeal of the Japanese yen, which held at a one-week high against the dollar and euro after having posted its biggest rally in more than two months. Against a basket of major currencies, the dollar was steady at a one-week low.
Washington and its allies were gearing up for a probable military action against President Bashar al-Assad's forces, which were blamed for last week's chemical weapons attacks.
Western officials told the Syrian opposition to expect a strike within days, and U.S. Defence Secretary Chuck Hagel said American forces in the region were "ready to go" if President Barack Obama gives the order.
The news on Syria overshadowed improving economic indicators, such as rising U.S. home prices and Germany's Ifo business survey hitting its highest in 16 months.
Overnight, U.S. and European stocks suffered their worst day since June, and investor nervousness was reflected in a nearly 12 percent jump on the CBOE volatility index, Wall Street's so-called fear gauge, to a two-month high.
" 1/8The Syrian issue 3/8 is adding a layer of nervousness on top of the debate of U.S. tapering which is having a very big impact on carry trade globally and having a very big impact on emerging markets," a senior trader at a foreign bank in Tokyo said.
Tokyo's Nikkei share average sagged 2.4 percent to a two-month low, while the yen was largely steady at 97.00 to the dollar and 129.870 to the euro after climbing more than 1 percent overnight.
MSCI's broadest index of Asia-Pacific shares outside Japan shed 0.5 percent on Wednesday, extending the previous session's 1.2 percent drop.
Emerging markets have been reeling for the past few weeks on expectations that the U.S. Federal Reserve will reduce its $85 billion a month bond-buying programme as soon as next month.
Emerging market currencies have been hit hard, with the Indian rupee, Indonesian rupiah and Thai baht among others at multi-year lows.
Indonesia's central bank board will meet on Thursday in a surprise move amid widespread speculation it will have to raise interest rates again to defend the fast-falling rupiah, now its lowest since April 2009, and its implied volatility at its highest.
The Indian rupee hit a record low on Tuesday and posted its biggest single-day fall in nearly 18 years after the lower house of Parliament approved a nearly $20 billion plan to provide cheap grain to the poor, raising concerns the fiscal deficit will blow out even further.
The Thai baht was at 32.15 per, its weakest level in three years.
The heightened geopolitical risk in the Middle East drove the prices of gold and oil higher, however.
Brent crude prices advanced 0.7 percent to a six-month high of $115.44 a barrel, extending Tuesday's 3.3 percent surge - their biggest one-day percentage gain in nearly 10 months.
Gold inched up 0.1 percent after climbing as much as 1.4 percent on Tuesday to a more than three-month high.