* Nikkei hits 6-week low, poised for 6 straight days of falls
* Exporters dragged lower by strong yen, economy doubts
* Machinery stocks hurt after unexpected fall in May orders
* Market views divided on need for more economy stimulus
By Aiko Hayashi
TOKYO, July 8 (Reuters) - Japan's Nikkei average hit its
lowest point in six weeks on Wednesday, hurt as the yen
strengthened on talk of more stimulus for the U.S. economy, and
by an unexpected slide in domestic machinery orders.
Komatsu <6301.T> and other machinery makers dropped after
Japan's core private-sector machinery orders fell 3.0 percent in
May from the previous month, suggesting a recovery in capital
spending may be delayed. []
"Uncertainty about U.S. consumer spending and the outlook for
corporate earnings is spurring yen strength and that's hitting
shares of exporters here," said Hiroaki Kuramochi, chief equity
marketing officer at Tokai Tokyo Securities.
The benchmark Nikkei <> lost 1.8 percent or 175.87
points at 9,471.92 by the midday break, with trade picking up a
bit from last week's average and looks poised to put in its sixth
straight day of losses.
At one point, it fell as low as 9,454.90, its lowest level
since May 29. In the five days to Tuesday, it shed 3.1 percent.
The broader Topix <> fell 1.9 percent to 892.32.
An adviser to President Barack Obama said on Tuesday the
United States should be planning for a possible second round of
fiscal stimulus to further prop up the economy after the $787
billion rescue package launched in February.
That heightened fears that an economic recovery will be slow
and that the corporate earnings season starting this week will be
weak, sending the Dow Jones industrial average <> to its
lowest close since April 28. [] []
The yen hit its highest levels in more than a month against
the dollar and the euro on Wednesday, with the dollar was down
0.3 percent at 94.59 yen <JPY=>. Investors fret over a stronger
yen as it eats into exporters' profits when they are repatriated.
"Calls for more stimulus steps are emerging in the U.S. as
the ones it has already launched haven't led to an improvement in
consumption," said Hiroichi Nishi, general manager of equity
marketing at Nikko Cordial Securities.
"But there's still a possibility that those economic steps
which were quite large will gradually start to have an impact.
Talk like this is also a sign that the government is determined
not to let the economy deteriorate further."
Some remained cautious, however.
"The jobs situation is still deteriorating and that's capping
a recovery in consumption," said Takahiko Murai, general manager
of equities at Nozomi Securities.
"Another round of stimulus measures may be necessary in not
only in the U.S. but in Japan."
Market analysts have said investors had a reality check after
data on Thursday showed U.S. employers had shed nearly half a
million jobs in June with the unemployment rate jumping to 9.5
percent, the highest in nearly 26 years. []
MACHINE STOCKS DOWN
Machinery stocks fell, with Komatsu shedding 3.5 percent to
1,385 yen. Kubota Corp <6326.T> dropped 3.5 percent to 739 yen
and Hitachi Construction <6305.T> sank 4.2 percent to 1,431 yen.
Exporters also lost ground. Honda Motor Co <7267.T> declined
4 percent to 2,430 yen and Toyota Motor Corp <7203.T> fell 3.1
percent to 3,480 yen. Tokyo Electron Ltd <8035.T> slumped 5
percent to 4,350 yen.
Shares of Aeon Co Ltd <8267.T>, Japan's second largest
retailer, fell 3.9 percent to 844 yen after it posted a 62
percent drop in operating profit for March-May as a slide in
consumer spending hit its supermarkets and its U.S. women's
clothing unit Talbots. []
Some 1.1 billions shares changed hands on the Tokyo
exchange's first section, compared with last week's morning
average of 955 million.
Declining stocks outnumbered advancing ones by more than 6 to
1.
(Editing by Edwina Gibbs)
