By Elaine Lies TOKYO (Reuters) - Japan's Nikkei average shed 0.3 percent on Wednesday as Canon Inc and other exporters were nailed by a stronger yen, with a string of dismal U.S. company news fanning worries about a global economic slowdown. Mitsubishi Corp and other commodities-linked shares were hit by oil's tumble to settle below $60 on Tuesday for the first time in 20 months, while oil and gas field developer Inpex Inc fell 4.6 percent. But chemicals firm Mitsubishi Rayon Co bucked the trend in a big way by surging 12.3 percent after saying on Tuesday it will acquire unlisted British chemicals producer Lucite International for $1.6 billion in cash Gloomy company news both overseas and in Japan is inhibiting investors already nervous after a series of disappointing economic indicators, including core Japanese machinery orders, which this week posted their biggest quarterly fall in a decade. "Whether it's economic indicators or company news, all of it's just too awful," said Takashi Ushio, head of the investment strategy division at Marusan Securities. "Domestically, there are a lot of shares that seem oversold, but given the bad fundamentals -- especially the outlook for poor Japanese earnings in the second half of this business year -- it's really hard to buy." In thin trade, the benchmark Nikkei shed 26.82 points to 8,782.48 after earlier falling more than 2 percent, while the broader Topix lost 7.10 points or 0.8 percent. Fears of a global slowdown grew on news of falling demand at aluminum maker Alcoa and a dismal outlook from Tyco International Ltd The market was also eyeing General Motors as its shares slid for a 5th day and investors worried about the chances of the auto sector gaining a government cash infusion. Many investors were jittery ahead of this weekend's summit by the G20 group of wealthy nations and large emerging economies in Washington to discuss steps to address the global financial crisis. "The previous G7 summit was mainly aimed at dealing with the credit crisis, but this one is now struggling to tackle the issue of slowing economies, with the market hoping for some kind of joint international action," said Ushio. "If nothing emerges, there's likely to be a huge shock, so nobody is buying at this point." Other market players, though, said that buying from pension funds and retail investors would emerge at the lows and keep the market supported. But some were skeptical, noting that while many individual investors have recently been opening new accounts with securities firms, the amount of their purchases are too small to add up to significant support in face of the general gloom. "I've attended a number of sessions at which companies give explanations of their results, and the tone across the board is very dark both for the first half and the second," said Masayoshi Okamoto, chief of dealing at Jujiya Securities. "In this climate, who's going to buy?" TRADERS TUMBLE AS OIL FALLS Trading firms were hit especially hard as oil extended its losses early on Wednesday after falling 5 percent the day before as the deepening global economic crisis dragged down markets and raised the specter of further slowdowns in energy demand. Crude oil futures for December delivery managed to crawl back above $59 in morning trade, but trading houses were still suffering although off earlier lows. Japan's largest trading house, Mitsubishi Corp, was down 6.4 percent at 1,412 yen, the fifth-largest drag on the Nikkei 225 by volume weight. Fellow trader Mitsui & Co shed 3 percent to 944 yen and Marubeni Corp fell 1.6 percent to 371 yen. The dollar clawed higher against the yen by midday, helping exporters pare their losses and bolstering the market Canon slipped 3.2 percent to 3,050 yen, while Sony Corp fell 3.5 percent. Panasonic Corp even climbed into positive territory, rising 0.9 percent to 1,500 yen. Trade was light on the Tokyo exchange's first section, with 917.4 million shares changing hands, compared with last week's morning average of 1.1 billion. Declining stocks outpaced advancing ones by nearly 2 to 1. (Reporting by Elaine Lies; editing by Sophie Hardach)

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