* MSCI Asia-Pacific index down 0.65 pct, Nikkei falls 0.77pct
* Spreadbetters expect European stocks to start lower
* Cohn's departure seen as tilting U.S. towardsprotectionism
* Dollar falls vs yen, Swiss franc; Canada dlr, Mexico pesofall
* U.S. stock futures down more than 1 pct
* Crude oil slips, gold extends rally amid risk aversion
By Hideyuki Sano and Shinichi Saoshiro
TOKYO, March 7 (Reuters) - Global stocks and the dollarslumped on Wednesday after a strong White House advocate forfree trade resigned, fanning fears that President Donald Trumpwill proceed with protectionist tariffs and risk a trade war.
Spreadbetters expected European stocks to open lower, withBritain's FTSE .FTSE falling 0.7 percent, Germany's DAX .GDAXI losing 0.8 percent and France's CAC .FCHI dropping0.85 percent.
White House economic adviser Gary Cohn, seen as a bulwarkagainst protectionist forces within the Trump administration,said on Tuesday he was leaving. response, S&P 500 futures ESc1 dropped more than 1percent setting the downbeat tone for Asia.
MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS was down 0.65 percent, while Japan's Nikkei .N225 retreated 0.77 percent.
Australian stocks .AXJO fell 1 percent, Hong Kong's HangSeng .HSI slipped 1.1 percent and China's blue-chip CSI300index .CSI300 lost 0.4 percent.
"If you're looking for an excuse to sell, this is the kindof announcement that certainly causes short-term downwardpressure," said Rick Meckler, president of investment firmLibertyView Capital Management in New Jersey, regarding Cohn'sresignation.
"He (Cohn) came from Wall street and certainly largeinstitutional investors felt he was very credible."
South Korea's KOSPI initially bucked the trend and rose asmuch as 0.75 percent amid a perceived easing of regionaltensions, following news on Tuesday that South Korea would holdits first summit with the North in more than a decade.
Cohn's resignation, however, froze a recovery in riskappetite in wider markets that had followed news of the Koreantalks, and the KOSPI surrendered gains to slip 0.45 percent.
In currency markets, the dollar fell as much as 0.6 percentto 105.45 yen JPY= , near its 16-month low of 105.24 touched onFriday.
The dollar had risen to 106.470 on Tuesday amid speculationthat Trump could be coaxed into watering down or holding off onthe tariffs.
Against the Swiss franc, the dollar also shed 0.4 percent to0.9371 franc CHF= , while the euro edged up 0.15 percent to$1.2423 EUR= .
Against a basket of major currencies .DXY , the dollardipped 0.15 percent.
"The worst outcome for financial markets, in terms ofpotential to create volatility, would be a confirmation ofrising trade friction and benign neglect of the dollar in theshort term," said analysts at ANZ.
The Canadian dollar and the Mexican peso retreated as Cohn'sdeparture was seen as raising risks Washington could walk awayfrom NAFTA negotiations.
The Canadian dollar fell 0.5 percent to C$1.2935 per dollar CAD=D4 while the Mexican peso weakened 0.6 percent to 18.86 tothe dollar MXN=D2 .
Commodities also fell on worries that trade friction couldslow global growth.
Brent crude futures LCOc1 gave up the previous day'sgains, dropping 0.85 percent to $65.23 per barrel. O/R
Copper on the London Metal Exchange CMCU3 lost 0.5 percentto $6,971.50 per tonne, paring a 1.4 percent gain from theprevious session. MET/L
Spot gold XAU= , on the other hand, stretched the previousday's rally and touched $1,340.42 an ounce, its highest sinceFeb. 26.
Other perceived safe havens such government bonds also faredwell. U.S. Treasury debt prices rose and as a result the 10-yearbenchmark note yield US10YT=RR declined about 2.5 basis pointsto 2.853 percent.