Nikkei slides below 17,000 as banks, retail sold

(Adds details, stocks)

By Elaine Lies

TOKYO, Oct 17 (Reuters) - Japan's Nikkei average ended morning trade below 17,000 for the first time in more than two weeks as bank shares took a beating for a second day after Wall Street sank following the reporting of poor bank earnings.

A slight rise in the yen also helped spur selling of automakers and other exporters. Shares of Nissan Motor Co (7201.T: Quote, Profile, Research, Stock Buzz) slipped 2 percent while electronics maker Sony Corp (6758.T: Quote, Profile, Research, Stock Buzz) fell 1.5 percent.

Sanyo Electric (6764.T: Quote, Profile, Research, Stock Buzz) sank 7.1 percent on news that it was giving up on the sale of its struggling semiconductor unit after private equity firm Advantage Partners LLP failed to secure funds for the deal amid tight credit markets. [ID:nT344855]

High-tech firms had been expected to lift the market after better-than-expected results were posted by U.S. technology bellwethers Yahoo (YHOO.O: Quote, Profile, Research, Stock Buzz) and chip maker Intel (INTC.O: Quote, Profile, Research, Stock Buzz) after the bell, but a slightly firmer yen kept gains capped.

"The rise in the yen led to selling of futures and then some arbitrage sales, diluting the expected positive impact of the U.S. results," said Yutaka Miura, a senior technical analyst at Shinko Securities.

"Market players have been turning their eye to domestic-demand linked shares, selling real estate and retailers, and this also sent the market lower."

While the impact of the long-awaited Yahoo and Intel results didn't result in prominent gains for Japanese high-tech shares, it did contribute to overall market support and helped prevent larger slides.