Nikkei down 1.9 pct as NEC, TDK and banks tumble

(Updates to midmorning)

TOKYO Aug 1 (Reuters) - The Nikkei average fell 1.9 percent on Friday, as electronics maker NEC Corp (6701.T) plunged 14 percent on a sharp drop in quarterly earnings and a ratings cut by a brokerage, while banks slid on sharp profit declines.

Electronics device maker TDK Corp (6762.T) also tumbled after cutting its outlook following a sharp fall in quarterly profit, and announcing plans to buy German electronic parts manufacturer Epcos AG EPCGn.DE for $1.9 billion in cash. [ID:nT172065]

Investors were also cautious ahead of a U.S. July employment report later in the day after U.S. data showing weaker-than-expected growth and a rise in the number of Americans applying for jobless benefits, rekindled worries about the health of the world's largest economy.

"Investors are reluctant to buy shares ahead of U.S. economic events," said Mitsuo Shimizu, deputy general manager of equity department at Cosmo Securities.

As of 0122 GMT, the benchmark Nikkei .N225 fell 250.58 points to 13,126.23. The broader Topix .TOPX lost 2 percent to 1,276.99.

NEC Corp dropped to 510 yen, the most actively traded stock by volume on the Tokyo Stock Exchange's main board.

It reported a 64 percent fall in its quarterly operating profit due to slow sales of network equipment and an increase in cellphone development costs. [ID:nT165391] UBS lowered its rating on the stock to "neutral" from "buy" after the earnings.

TDK fell 6 percent to 6,110 yen, becoming the biggest drag on the Nikkei after posting a 72 percent fall in group net profit for the three months ended June 30, and cutting its annual forecast by 15 percent to 55 billion yen.

Financial shares were under selling pressure after Mizuho Financial Group (8411.T) and Sumitomo Mitsui Financial Group (8316.T) posted sharp declines in first-quarter core profitability, hurt by the global market downturn and a weakening domestic economy. [ID:nT177780]

Mizuho fell 2.5 percent to 513,000 yen and Sumitomo Mitsui lost 6.4 percent to 794,000 yen.

Japan's corporate earnings season is in full swing, with Nissan Motor (7201.T) and Astellas Pharma (4503.T) among major firms due to announce results later in the day. (Reporting by Taiga Uranaka)