Japan's Nikkei falls 1.8 pct; banks, Inpex down

(Updates to midday)

TOKYO, July 8 (Reuters) - The Nikkei stock average fell 1.8 percent on Tuesday, with financials such as top lender Mitsubishi UFJ Financial Group (8306.T) dropping sharply as a fresh supply of bad news kept credit concerns forefront in investors' minds.

Oil and gas field developer Inpex Holdings Inc (1605.T) plunged after a sharp drop in crude prices, while big fuel users such as power utilities rose.

The benchmark Nikkei .N225 ended the morning down 238.18 points at 13,121.86 after falling to a near three-month low of 13,073.52.

The broader Topix lost 1.5 percent to 1,292.53.