Nikkei drifts lower on U.S.-China trade uncertainty

* SoftBank Group, Fast Retailing fall on futures selling
* Financial stocks outperform after U.S. yields strong

By Ayai Tomisawa
TOKYO, July 17 (Reuters) - Japan's Nikkei edged lower on
Wednesday after U.S. President Donald Trump's comments on trade
soured risk sentiment, while tech shares and chip-related stocks
slid in step with their U.S. counterparts.
But financial stocks such as banks and insurers, which
benefit from higher yielding products such as foreign bonds,
gained ground after U.S. Treasury yields rose on data showing
U.S. retail sales increased more than expected in June.
The Nikkei share average .N225 fell 0.3% to 21,470.69 in
mid-morning trade, while the broader Topix .TOPX gained 0.1%
to 1,570.55.
On Wednesday, U.S. stocks were dented after Trump said there
was a long way to go with China on trade and threatened to put
tariffs on another $325 billion of Chinese goods. "There is uncertainty over trade talks. The market has
become sensitive again on whether there will be progress in the
talks between the United States and China," said Yoshinori
Shigemi, global market strategist at JPMorgan Asset Management.
"We will stay cautious against trade-related headlines for
now."
After the Philadelphia semiconductor index .SOX dropped
overnight, Tokyo Electron 8035.T and Advantest Corp 6857.T
both shed 0.8%. Other tech shares followed suit, with TDK Corp
6762.T declining 1.3% and Taiyo Yuden 6976.T sliding 1.8%.
Meanwhile, financial stocks outperformed, with Sumitomo
Mitsui Financial Group 8316.T rising 0.5%, Dai-ichi Life
Holdings 8750.T adding 0.3% and T&D Holdings 8795.T soaring
0.9%.
Futures selling dragged down index-heavy stocks such as
SoftBank Group 9984 , Fast Retailing 9983.T and Terumo Corp
4543.T , which fell 2.9%, 1.3% and 1.7%, respectively.
Elsewhere, Aeon Fantasy 4343.T , which operates
entertainment facilities in shopping centres, jumped 10% after
the company said its June same-store-sales soared 13.2% on the
year thanks to the popularity of medal games, a type of game
played for tokens commonly found in shopping arcades in Japan.
Declining issues outnumbered advancing ones 1,325 to 714.


(Editing by Jacqueline Wong)