Nikkei gives up early rise despite GDP, banks down

* Fundraising plans hit MUFG, Hitachi

* Shippers steam higher on rebound from last week's fall

* GDP impact positive, but brief

By Elaine Lies

TOKYO, Nov 16 (Reuters) - Japan's Nikkei stock average lost 0.3 percent on Monday as exporters and tech firms lost ground, erasing early gains despite data showing Japan's Japan's economy expanded at the fastest pace in two years in July-September. Falls in bank shares weighed on the market after three sources said Mitsubishi UFJ Financial Group (8306.T) would issue about $11 billion in new shares to meet stricter capital requirements and boost lending in Asia. [ID:nBNG152533]

Japan's economy grew 1.2 percent in the third quarter from the previous three months, marking a second straight quarterly expansion, but analysts warn the recovery may lose momentum in coming quarters due to weak domestic demand. [ID:nTKZ006307]

The increase was much greater than a median market forecast of a 0.7 percent rise. Exports and personal consumption led the growth, while corporate investment picked up for the first time since the January-March quarter of 2008.

"The GDP figures were basically good, with consumption having picked up, but this consumption was mainly supported by government stimulus measures and will eventually run out of steam," said Takashi Ushio, head of the investment strategy division at Marusan Securities.

"On top of this, news of the MUFG fundraising is weighing on the market, depressing bank shares in particular with worries about how much other banks might have to issue."

The benchmark Nikkei .N225 lost 40.14 points to 9,730.17 after starting the day in positive territory. The broader Topix fell 1 percent to 858.20.

"I cannot say this (GDP) shows that the economy is on its way to a continuous recovery. There is still sufficient risk for the economy to see a double-dip and slow down unless additional stimulus measures are provided...," said Yoshikiyo Shimamine, chief economist at Dai-Ichi Life Research Institute.

"There are no signals of independent growth in or outside the country."

SHARE ISSUES

MUFG's common share issue of roughly 1 trillion yen would mark a record for a Japanese financial firm, according to Thomson Reuters data.

Hitachi Ltd (6501.T), Japan's biggest electronics firm by revenues, slid after two sources familiar with the matter said it plans to raise up to 400 billion yen ($4.5 billion) by issuing new shares and convertible bonds to shore up its battered capital base [ID:nT155750]

"The bank fund-raising is pretty much unavoidable, and now we have Hitachi as well," said Nagayuki Yamagishi, a strategist at Mitsubishi UFJ Securities.