Nikkei rally runs out of steam on fresh trade worries

* Nikkei almost flat as trade worries stem market rally
* Earning outlook continues to deteriorate
* SoftBank Group falls as T-Mobile/Sprint deal faces more
hurdle
* Nissan down, proxy advisor calls for oust of CEO

By Hideyuki Sano
TOKYO, June 12 (Reuters) - Japan's Nikkei share average
.N225 struggled to extend gains on Wednesday after a three-day
winning streak, as the White House's latest tough stance on
China kept worries about a global slowdown intact.
The Nikkei .N225 rose 0.09% to 21,223.36, with an
immediate resistance seen at its 100-day moving average now at
21,272. The broader Topix .TOPX shed 0.07% to 1,560.16, with
decliners outnumbering advancers by about 11 to nine.
The market's recovery over the past several sessions from
multi-month lows touched earlier this month is running out of
steam, due largely to concerns about possible hits to the global
economy from trade spats between the United States and China.
U.S. President Donald Trump said on Tuesday that he was
holding up a trade deal with China and had no interest in moving
ahead unless Beijing agrees again to four or five "major points"
that Trump did not specify. "If you list up negative factors, there are so many,
starting from U.S-China frictions and Brexit. When you try to
list up positive factors, they are few and far between," said
Seiki Orimi, senior investment strategist at Mitsubishi UFJ
Morgan Stanley Securities.
Indeed, Japanese companies' earnings outlook continued to
deteriorate. The forward earnings per share of Topix has dropped
6.7% from its peak in late last year and is now down 2.1% from a
year ago.
In a rare bright spot, Japan's machinery orders, a key
leading gauge of capital spending, unexpectedly rose for a third
straight month in April, helped by the strength in domestic
demand. Yet that meant little in light of the overwhelming
uncertainties Sino-U.S. frictions are posing to companies'
long-term investment plans, particularly in the technology
sector.
"Even if we have some good numbers, people won't take them
at face value given what's going on between the U.S. and China,"
said Hiroshi Watanabe, economist at Sony Financial Holdings.
"Cyclically speaking, it is about the time the global
semi-conductor cycle could bottom out. But trade in tech
products are unlikely to recover given disruptions to supply
chains, delaying any potential bottom further," he said.
Electric machinery company shares .IELEC.T were down 0.1%,
broadly in line with the overall market.
SoftBank Group 9984.T fell 2.0% after 10 U.S. states led
by New York and California filed a lawsuit to stop T-Mobile US
Inc's TMUS.O $26 billion purchase of Sprint Corp S.N , a
subsidiary of SoftBank Group. Nissan Motor 7201.T fell 0.9% as its governance crisis
appeared to deepen. Leading proxy advisory firm ISS has urged
Nissan shareholders to vote against the reappointment of Chief
Executive Officer Hiroto Saikawa while the rift with its
alliance partner Renault RENA.PA over governance reform grew
further. (Editing by Sam Holmes)