* Nikkei has dropped 4.3 pct from its 2019 peak
* Communications sector helped by SoftBank Corp, Yahoo Japan
By Daniel Leussink and Ayai Tomisawa
TOKYO, May 9 (Reuters) - Japan's Nikkei fell for a fourth day on Thursday to end at its lowest since late March as investor caution prevailed ahead of the next round of Sino-U.S. trade talks.
The Nikkei share average dropped 0.93 percent to 21,402.13, its lowest finish since March 29.
The benchmark index has shed 4.3 percent after hitting a 2019 high on April 24.
U.S. President Donald Trump has threatened to impose additional tariffs on Chinese goods beginning on Friday, while Beijing said it would retaliate if tariffs rise.
Chinese Vice Premier Liu He is set for talks in Washington on Thursday and Friday with U.S. officials who have complained that Beijing has backtracked on earlier commitments.
"The direction of the Japanese market relies on the outcome of the trade talks on Friday. If the two countries delay the conclusion while keeping the market with a bit of hope, we may not see much turbulence," said Isao Kubo, an equity strategist at Nissay Asset Management.
The broader Topix ended off 1.38 percent at 1,550.71. All but two of its 33 subsectors finished in negative territory.
Cyclical stocks were particularly sold, with shippers and machinery manufacturers with high exposure to China underperforming.
Shipping firms Kawasaki Kisen and Mitsui OSK Lines closed down 5.9 percent and 2.2 percent, respectively, while construction equipment maker Komatsu Ltd gave up 4.2 percent. Robot maker Fanuc Corp slipped 3.3 percent and Yaskawa Electric dropped 2.6 percent.
The communications sector was helped by SoftBank Corp , which jumped 6.9 percent after saying that it would spend $4 billion to raise its stake in Yahoo Japan Corp , which soared 9.4 percent.
The telco said it would buy 456.5 billion yen ($4.2 billion) worth of new shares to be issued by Yahoo Japan, increasing SoftBank Corp's stake to 45 percent from 12 percent.
Elsewhere, Misawa Homes jumped 18.7 percent on news it will become fully owned by a new joint venture related to the town development business between Toyota Motor Corp and Panasonic Corp and be delisted. (Editing by Jacqueline Wong)