Nikkei dips, China worry offsets Honda and Nissan

* Eyes on China but share tumble seen due to profit-taking

* Automakers surge after Honda, Nissan eke out surprise gains

* Traders, smelters hit after oil, metals price fall

* Earnings season heats ups; Sony to report after bell

By Aiko Hayashi

TOKYO, July 30 (Reuters) - Japan's Nikkei average edged down 0.1 percent on Thursday, with caution after a Chinese stock tumble offsetting a surge for Honda Motor Co (7267.T) and Nissan Motor Co (7201.T) on surprise quarterly profits.

Sumitomo Metal Mining (5713.T) and shares of other raw materials and energy firms lost ground after commodity prices fell on concerns that China might be ready to hit the brakes on lending, a move that could curb demand and hinder a global economic recovery. [ID:nHKG282068]

The Shanghai Composite Index .SSEC lost 5 percent on Wednesday, its biggest daily decline in eight months, and extended losses on Thursday to fall 1.2 percent.

It had surged nearly 90 percent this year before Wednesday's tumble on worries that share valuations had grown excessive.

But market players said the fall was most likely due to profit-taking, with some saying it was unlikely to drag the global market down with it.

"The tumble in Chinese stocks is weighing on the market psychologically, but I don't think China will start tightening lending to the extent that it would damage the economy." said Junichi Misawa, senior fund manager at STB Asset Management.

In comments reported on Thursday, the vice governor of China's central bank said the bank will "unswervingly" stick to an appropriately loose monetary policy and will use market tools not quota controls. [nPEK348322].

"The Nikkei is already above 10,000 and although we have had some good results, it is not as if there's been a whole wave of positive surprises and this is limiting gains," Misawa said.

The benchmark Nikkei .N225 fell 11.89 points to 10,101.35 in thin trade, after snapping on Tuesday a nine-day rising streak, its longest since 1988.

The broader Topix .TOPX rose 0.1 percent to 931.28.

The Nikkei, along with the global stock market, has rallied since its March lows, recovering more than 40 percent so far, propelled by stronger-than-expected U.S. earnings and optimism about the economy.

Market players are now focused on domestic earnings, which peak on Thursday and Friday. Firms scheduled to announce results later in the day include Sony Corp (6758.T) and Fujitsu Ltd (6702.T).

AUTOS STRONG, COMMODITIES FALL

Honda shot up 8.1 percent to 2,995 yen and Nissan soared 9 percent to 688 yen after both made small surprise profits last quarter, though a sustained recovery appeared elusive with demand relying largely on government stimulus. [ID:nT188181]

The news helped boost industry leader Toyota Motor Corp's (7203.T) shares by 3.4 percent to 3,930 yen. The transport equipment subindex .ITEQP.T climbed 4.2 percent to become the biggest gainer among the subindexes.

Commodities-linked shares fell as oil dipped towards $63 a barrel CLc1 and base metals slumped on Wednesday following a 5 percent slide in Chinese stocks, although metals regained some ground on Thursday.

Sumitomo Metal Mining lost 5.3 percent to 1,371 yen and fellow smelter Dowa Holdings (5714.T) fell 3.3 percent to 407 yen.

Oil and gas field developer Inpex (1605.T) shed 1.8 percent to 701,000 yen and distributor Nippon Oil 5001.T slid 2.7 percent to 503 yen. Mitsubishi Corp (8058.T), Japan's largest trading house, declined 2 percent to 1,787 yen.

Shares of Fanuc Ltd (6954.T), an industrial robot maker, lost 3.1 percent to 7,570 yen after it reported a tumble in quarterly operating profit, as demand at home and in other countries was weak except for China. (Reporting by Aiko Hayashi; Editing by Edwina Gibbs)