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Nikkei slides 6.5 pct as Toyota, Isuzu hammered

* Nikkei slides 6.5 pct, biggest one-day loss in 2 weeks

* Toyota dives on earnings fear, Isuzu plunges on downgrade

* Global economy fears grow, fed by dismal U.S. data

* Toyota slashes earnings forecast after the close (Adds Toyota, Elpida earnings announcements)

By Elaine Lies

TOKYO, Nov 6 (Reuters) - Japan's Nikkei average slid 6.5 percent on Thursday to its biggest one-day loss in nearly two weeks, with Toyota Motor Corp 7203.T tumbling on earnings fears and other exporters hit by a stronger yen amid jitters over the global economy.

Toyota, whose shares fell over 10 percent on an early report of weaker profits, more than halved its annual operating forecast in a shock announcement after the closing bell that analysts said was sure to weigh on its stock and the overall market. [ID:nL695591]

“I first mistook its revised full-year operating profit forecast as its first-half results,” said Takeshi Osawa, senior fund manager at Norinchukin Zenkyoren Asset Management.

"The sense of things having bottomed out may be stripped away." It was a rough day for automakers, with truck maker Isuzu Motors Ltd 7202.T losing a fifth of its value after it cut its earnings outlook and was hit by brokerage downgrades.

And underscoring the worries of the firms central to Japan's export-centred economy, Honda Motor Co 7267.T Chief Executive Takeo Fukui said Japanese authorities should intervene in the currency market to prevent wild fluctuations in the yen. [ID:nT2909]

The benchmark Nikkei .N225 fell 622.10 points to 8,899.14 in light trade for its biggest one-day loss since Oct 24.

The broader Topix .TOPX slid 6 percent to 909.30, with investors quickly forgetting the bounce seen a day earlier from the election of Barack Obama as U.S. president.

“With the election over, the eyes of investors are turning to the economy, with a sense that nothing quick can be done to stop the global economic slide,” said Hideyuki Ishiguro, a supervisor at the investment strategy department of Okasan Securities.

“Over the preceding six trading days, the Nikkei rose nearly 2,000 points, with investors snapping up shares that had been sharply sold regardless of things such as earnings. But now earnings are determining their choices to buy or sell.”

Grim economic news in the United States included a report that showed deep cuts in employment by private employers in October and data that showed the vast service sector contracted sharply last month as the worst financial crisis in 80 years roiled the world’s largest economy. [ID:nN05256456]

But some Tokyo market players said the Nikkei’s fall was partly due to simple profit-taking after stocks climbed from a low of 6,994.90 on October 28.

“You have some shares already up substantially, so wanting to take profits is only natural, especially since gains are seen capped at around 9,500,” said Hiroaki Osakabe, a fund manager at Chibagin Asset Management.

TOYOTA TUMBLES

Toyota, which fell to 3,810 yen, said its annual net earnings will plunge to a 9-year low, and market players said there would be an inevitable ripple effect on car parts makers and similar shares.

Isuzu slid to 161 yen. The Nikkei newspaper also quoted Isuzu's president as saying it may buy part of General Motors Corp GM.N midsized truck unit but that it had no intention of taking over the entire unit. [ID:nL695591]

Honda slid 9.8 percent to 2,475 yen. Nissan Motor 7201.T lost 9 percent to 455 yen.

Other blue-chip exporters also fared badly as the dollar slipped below 98 yen JPY=. FXNEWS [FRX/]

Canon Inc 7751.T fell 12.6 percent to 3,470 yen, Sony Corp 6758.T slid 11.1 percent to 2,295 yen and Panasonic 6752.T lost 8.5 percent to 1,589 yen.

More bad earnings news emerged after the close from computer memory maker Elpida Memory Inc 6665.T, which posted its fourth straight quarterly loss on a prolonged slump in chip prices, and revised down its annual capital spending outlook. [ID:nT3192]

Its shares fell 6.5 percent to 630 yen.

Trade was light on the Tokyo exchange’s first section, with 2.38 billion shares changing hands, compared with last week’s daily average of 3.01 billion.

Declining stocks outpaced advancing ones by nearly 7 to 1. (Additional reporting by Taiga Uranaka; Editing by Edwina Gibbs)

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