Nikkei tumbles on global slowdown worries; SoftBank Group, exporters weigh

* SoftBank Group dives after report co faces challenges
raising
latest fund
* Exporters, mining stocks weak
* Cocokara Fine soars on merger talks with Sugi

By Ayai Tomisawa
TOKYO, June 3 (Reuters) - Japanese stocks hit the skids on
Monday as investors fretted about the rising risks to global and
domestic growth from a potentially protracted and widening
tariff war between the United States and its major trading
partners.
Index-heavy SoftBank Group Corp 9984.T tumbled 6.2% after
the Wall Street Journal reported that the company's bid to raise
a second mega fund has met with a chilly reception from some of
the world's biggest money managers. The Nikkei share average .N225 ended 0.9% lower at
20,410.88, the weakest closing level since Feb. 9. In intraday
trade, it slumped 1.4% to hit a 4-1/2 month low of 20,305.74.
Modest gains for the yen also battered exporters already
under pressure from global trade frictions. The dollar dropped
0.1% at 108.19 yen JPY= , after hitting as low as 108.10 during
Asian trade, its lowest since Jan. 14.
Shares of Fanuc Corp 6954.T tumbled 3.3%, Yaskawa Electric
6506.T declined 1.8%, Tokyo Electron 8035.T shed 2.1% and
Komatsu Ltd 6301.T fell 1.8%.
A senior Chinese official said on Sunday that the United
States cannot use pressure to force a trade deal on China,
refusing to be drawn on whether the leaders of the two countries
would meet at the G20 summit to bash out an agreement.
China threatened on Friday to unveil an unprecedented
hit-list of "unreliable" foreign firms, groups and individuals
that harm the interests of Chinese companies, as a slate of
retaliatory tariffs on imported U.S. goods. "Investors' main concern is that the trade war may hurt
global growth," said Toru Ibayashi, executive director of wealth
management at UBS Securities, Japan, adding that the Nikkei
could fall further.
On Monday, a private business survey showed that China's
factory activity expanded at a steady but modest pace in May,
though front-loading of shipments to avoid higher U.S. tariffs
masked underlying weakness in the world's second-biggest
economy. A run of recent indicators also showed China's growth
engine decelerating. "The U.S. manufacturing growth is also slowing. Moreover, we
may not be able to avoid a negative impact to the Japanese auto
industry from U.S.-Mexico issues," Ibayashi said.
U.S. President Donald Trump, incensed by a surge of illegal
immigrants across the southern border, vowed on Thursday to
impose a tariff on all goods coming from Mexico, starting at 5%
and ratcheting higher until the flow of people ceases.
Mining stocks also lost ground, after oil prices on Monday
extended losses of over 5% from Friday. Inpex Corp 1605.T
stumbled 1.9%, while Japan Petroleum Exploration Co 1662.T
tanked 3.7%.
The broader Topix .TOPX dropped 0.9% to 1,498.96.
Buying in defensive stocks reflected investors' risk-averse
stance. Utility and real estate shares outperformed, with both
Tokyo Electric Power 9501.T and Mitsubishi Estate 8802.T
rising 2.3%.
Drugstore operator Cocokara Fine 3098.T jumped 16.6% to a
daily limit high of 4,905 yen after the company said it is
discussing a merger with Sugi Holdings.