* All subsectors except for mining fall in broad selloff * Short-term hedge funds main sellers - fund manager * Nikkei not far from entering bear market territory By Ayai Tomisawa TOKYO, Aug 28 (Reuters) - Japan's Nikkei share average tumbled to a two-month low on Wednesday, extending its losses into a third day on geopolitical uncertainty over a possible U.S.-led military strike against the Syrian government, while persistent concerns about a slide in emerging markets added to the dour mood. The Nikkei dropped 2.1 percent to 13,264.50 in mid-morning trade, breaching its immediate support line of 13,270.72, a 23.6 percent retracement of the slide from its May high to its low in June. "Short-term hedge funds are the main sellers. They were long on the dollars and stocks, but they are reversing their positions," a fund manager at a Japanese asset management firm said. "Selling from this particular news (on Syria) should be short-lived. But if emerging countries' weakness eventually becomes big enough to hurt global companies' earnings and their economies, long-term investors will follow suit, and the Nikkei may enter a bear market," he said. The Nikkei hit a low of 13,210.84 earlier in the morning, the lowest since June 27 and was down 17 percent from its May peak. The benchmark will enter a bear market if it slides to 12,754, or down 20 percent from the 5-1/2 year high reached on May 23. Selling was broad-based, with exporters leading the declines on the back of a rising yen as the geopolitical uncertainty prompted investors to pile into the safe-haven Japanese currency. Toyota Motor Corp dropped 2.4 percent and was the second most traded stock, Honda Motor Co fell 2.8 percent and Sony Corp slid 3.1 percent. The dollar last traded down 1.5 percent against the yen at 97.04 yen, not far from a one-week low of 96.97 yen reached earlier. A strong yen hurts Japanese exporters' competitiveness overseas as well as their dollar earnings when repatriated. Commodity stocks bucked the market on the back of rising oil futures. Inpex Corp gained 1.2 percent and Japan Petroleum Exploration advanced 0.8 percent. The Topix dropped 2.1 percent to 1,110.44. All 33 of the Topix's subsectors except for the mining sector were in negative territory. Adding to the sombre mood is the continued slide in emerging market currencies, said Yutaka Miura, a senior technical analyst at Mizuho Securities. "Short-term investors may sell futures if emerging markets' performances are bad. We need to monitor the yen's level as well, and we need to be bracing for volatility amid thin volume," Miura added. On Tuesday, emerging market currencies such as the Turkish lira and the Indian rupee hit record lows as doubts over the Syrian situation added to pressure from investors' bracing for an end to the supply of cheap dollars from the U.S. Federal Reserve's monetary stimulus. Western powers told the Syrian opposition to expect a strike against President Bashar al-Assad's forces within days, according to sources who attended a meeting between envoys and the Syrian National Coalition in Istanbul. Washington said on Monday it believed the Syrian president was responsible for a chemical weapons attack on civilians last week.