TOKYO: Asian shares fell on Monday as Chinese stocks extended last week's sharp losses, while the yuan bounced in volatile trade hours ahead of an IMF decision on whether to promote it to a basket of global reserve currencies.

MSCI's broadest index of Asia-Pacific shares outside Japan fell 0.7 percent, and was on course to log a loss of about 2.7 percent for the month of November, after making its first gains in six months in October.

Japan's Nikkei dropped 0.4 percent, though still looked set for a monthly gain of more than 3 percent.

Mainland Chinese shares opened slightly higher but then sank 1.7 percent, after posting their biggest one-day drops in more than three months on Friday.

Market sentiment remained shaky due to the resumption of IPOs, renewed efforts by the securities regulator to clamp down on leveraged buying and concerns about the cooling economy.

"At the heart of the issue, I think, would be worries that the authorities might be starting to fade out various stock price supporting measures they had started in July," said Naoki Tashiro, the president of TS China Research.

The yuan bounced back in a volatile trade on the day when the International Monetary Fund is expected to add the currency to its benchmark currency basket on Monday.