October 9, 2018 / 3:11 AM / 9 days ago

Nikkei falls to 3-week low hit by worries about China; tech shares sold

* Global risk aversion puts yen in demand, hurts Japanese stocks

* Tech shares, China-related stocks fall

* Strong yen dents Japanese exporters

By Ayai Tomisawa

TOKYO, Oct 9 (Reuters) - Japan’s Nikkei fell to a three-week low on Tuesday morning after shares of firms with big exposure to China languished on worries about its economy while chip equipment makers tumbled, tracking weakness in U.S. tech shares overnight.

The Nikkei share average was down 0.9 percent to 23,564.91 at the midday break, after falling to as low as 23,442.86, the lowest point since Sept. 18.

Markets in Japan were closed for a holiday on Monday, when Chinese stocks and the yuan tumbled on growing fears the economic impact of the Sino-U.S. trade war will deepen.

“Japanese shares are being pressured by factors that are difficult to price in,” said Nobuhiko Kuramochi, a strategist at Mizuho Securities, adding that the Nikkei is expected to trade between 23,000-24,000 this week.

Analysts also said that global risk aversion continues amid rising U.S. yields, triggering a sell-off in Japanese futures. In Asian trade, U.S. 10-year Treasury yields hit a fresh seven-year high of 3.252 percent.

Exporters were sold after the safe-haven yen extended gains against the dollar to a fourth straight session, reaching 113.17 in Asian trade. Last week, it hit a nearly 11-month low of 114.54 yen per dollar.

Toyota Motor shed 2.7 percent and Honda Motor <7267.T. dropped 2.4 percent.

Construction machinery makers as well as electronics component makers were under pressure. Hitachi Construction Machinery slid 2.4 percent, industrial robot maker Fanuc 2.7 percent and Murata Manufacturing Co 2.2 percent.

The Philadelphia SE Semiconductor Index fell 1.1 percent overnight, hurting Japanese chip-related stocks. Tokyo Electron tumbled 4.5 percent, Screen Holdings dropped 5 percent and Advantest Corp 4.1 percent.

The broader Topix dropped 1.3 percent to 1,770.19. (Editing by Richard Borsuk)

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