*Nikkei falls 1.1 percent after losing as much as 1.9 percent
*Trading houses lead falls on global economy worries, oil
*Amid uncertainty surrounding Lehman, some hope
(Adds stocks, details)
By Aiko Hayashi
TOKYO, Sept 10 (Reuters) - The Nikkei average slipped 1.1
percent on Wednesday, led lower by trading houses like Mitsubishi
Corp <8058.T> on a drop in oil prices and worries about the
global economy, while tech shares were hurt by a firmer yen.
Worries about Lehman Brothers had pressured financial stocks
sending the benchmark index sharply lower in earlier trade but
banking shares later found higher ground, with some market
participants saying that they had been oversold.
"It's not too strange that Japanese bank shares gain after
their U.S. peers fell as Japanese banks had been sold off more in
the last two months or so," said Soichiro Monji, chief strategist
of the equity management department at Daiwa SB Investments.
Machine tool makers such as Okuma Corp <6103.T> dropped after
industry data showed orders for Japanese machine tools fell 14.2
percent in August from a year earlier, reflecting a weakening
global economy.
The benchmark Nikkei average <> shed 131.11 points to
end the morning session at 12,269.54, after falling as much as
1.9 percent earlier.
The broader Topix <> declined 0.6 percent to 1,184.18.
Worries about the health of the global economy continued to
hang over the market.
"Funds that had held stocks such as shippers were expecting
to benefit from a global economic boom led by emerging economies
but they are now dumping them as the situation has reversed,"
said Kenichi Hirano, operating officer at Tachibana Securities.
Uncertainty over whether Lehman <LEH.N> will be able to
survive the credit crisis was also a major theme but some said
that the investment bank's third-quarter results, due later in
the day, could provide its management with the opportunity to
reassure the market.
"I think there's a little bit of hope for Lehman's
announcement tonight about its strategies," said Hirano.
Shares in Lehman Brothers, the No. 4 U.S. investment bank,
skidded 45 percent on Tuesday after news that talks about a
possible investment in Lehman from Korea Development Bank had
broken down. []
TRADING HOUSES LEAD MARKET
Worries about the global economy pushed trading houses lower,
also hurt after U.S. crude oil futures dropped more than $3 on
Tuesday. []
Mitsubishi was down 2.5 percent at 2,525 yen, while Mitsui Co
<8031.T> shed 1.7 percent to 1,535 yen and Sumitomo Corp <8053.T>
dropped 2.8 percent to 1,202 yen.
Trading houses are major dealers in energy and also have
stakes in oil and gas projects.
Other stocks hit by economic worries included steel shares as
well as shippers, which declined after the Baltic freight index
<.BADI> fell for a 15th straight day.
Nippon Steel Corp <5401.T> tumbled 4.4 percent to 453 yen,
JFE Holdings Inc <5411.T> sank 3.8 percent to 4,050 yen and
shipper Mitsui OSK Lines <9104.T> declined 2 percent to 1,058
yen.
Among high-tech exporters, Sony <6758.T> fell 2.8 percent to
3,820 yen and Canon Inc <7751.T> declined 2.6 percent to 4,520
yen.
The dollar dropped to a session low against the yen at 106.84
<JPY=>. Investors fret over a stronger yen as it curbs exporters'
overseas profits when they are brought home.
Shares of Okuma Corp <6103.T> slipped 0.9 percent to 657 yen
and Toshiba Machine Co <6104.T> dropped 3.2 percent to 394 yen.
Japan's top bank Mitsubishi UFJ Financial <8306.T> added 1.3
percent to 851 yen, while No.2 Mizuho Financial Group <8411.T>
fell 1.1 percent to 452,000 yen.
Trade picked up on the Tokyo exchange's first section, with
980 million shares changing hands, above last week's morning
average of 859 million.
Declining shares beat advancing ones by 873 to 725.
(Reporting by Aiko Hayashi; Editing by Edwina Gibbs)
