June 22, 2018 / 2:48 AM / 3 months ago

Nikkei falls on trade war worries; automakers underperform

* Nikkei has fallen 1.6 pct for the week

* Daimler's profit cut hurts Japanese automakers

* Consumer goods makers buck weakness

By Ayai Tomisawa

TOKYO, June 22 (Reuters) - Japan's Nikkei share average dropped on Friday morning after Germany's Daimler cut its profit forecasts citing tariff concerns and some U.S. data came in below expectations, hurting cyclical stocks.

The auto sector was under the most pressure, tumbling 2.2 percent to be the worst performer on the board.

The fall came after Germany's Daimler cut its 2018 profit forecast because of fears over tariffs on the Mercedes Benz cars it exports from the United States to China.

BMW said it was looking at "strategic options" because of the trade dispute between the United States and China.

Toyota Motor Corp dropped 2.8 percent, Honda Motor Co and Mazda Motor Corp fell 2.3 percent.

The Nikkei fell 0.9 percent to 22,480.90 in midmorning trade. The benchmark index has declined 1.6 percent in the week.

The Philadelphia Federal Reserve said overnight that its business conditions index fell to 19.9 in June, the lowest level since November 2016, from 34.4 in May.

"The weak U.S. economic data and trade war headlines are all hurting the Japanese market's sentiment and prompting a sell-off in blue chip stocks," said Yoshinori Shigemi, global market strategist at JPMorgan Asset Management.

Earlier this week, U.S. President Donald Trump threatened to impose a 10 percent tariff on $200 billion of Chinese goods while Beijing warned it would fight back.

India, the world's biggest buyer of U.S. almonds, raised import duties on the commodity by 20 percent, joining the European Union and China in retaliating against Trump's tariff hikes on steel and aluminium.

"People started to worry seriously that the global economy will falter," Shigemi said.

Shippers also underperformed, with Mitsui OSK Lines and Kawasaki Kisen both sliding 2.5 percent on concerns that shipping demand will decline due to falling commodity prices.

Conversely, consumer goods makers, which suffer less from such global woes, attracted buying. Cosmetics maker Shiseido Co rose 0.5 percent, Japan Tobacco added 0.6 percent and diaper maker Unicharm Corp advanced 0.9 percent.

The broader Topix shed 0.6 percent to 1,740.94.

Reporting by Ayai Tomisawa Editing by Eric Meijer

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