TOKYO, Oct 19 (Reuters) - Japanese shares fell on Monday but pared early losses after data showed China's economy did not cool as much as expected in the third quarter.
The Nikkei share average ended the morning session down 0.6 percent at 18,190.36 points.
Sectors with significant exposure in China fell steadily early in the morning as investors nervously awaited a slew of key economic data from China.
"There was a bit of concern because Premier Li recently made comments about the difficulty of achieving 7 percent GDP growth, which dampened sentiment ahead of the figures coming out, so people are quite pleased to see it beat estimates at 6.9 percent," said Gavin Parry, managing director at Parry International Trading, in Hong Kong.
"These numbers are good for Japan, particularly for construction and possibly for related sectors with exposure in China."
China's economic growth eased to 6.9 percent in the third quarter from a year earlier, beating expectations for 6.8 percent but still the slowest since the global financial crisis, putting pressure on Beijing to roll out more support measures.
Shares of Japanese iron and steelmakers fell 1.6 percent, with Kobe Steel shedding 2.6 percent and JFE Holdings slipping 2 percent.
Construction gained 0.8 percent.
The Topix subindex for real estate shed 1.3 percent during the morning session, erasing some of the sector's Friday gains.
Asahi Kasei Corp continued its tumble following last Wednesday's disclosure that its subsidiary subcontracted faulty installation of foundation piles and then modified data in reports concerning the Yokohama apartment complex. The construction outfit fell 8 percent during the morning session.
Pharmaceutical shares reversed early losses to gain 0.5 percent as investors continue to buy cyclical shares.
Tokyo Electric Power Co gained 3.4 percent after the Nikkei business daily reported the utility would issue bonds for the first time in six years, raising 330 billion yen ($2.77 billion) through multiple offerings within the 2016 fiscal year.
The debt issuance, said to be underwritten by five major brokerages, would be TEPCO's first since confidence in the utility was shattered by the Fukushima Daiichi nuclear disaster in 2011.
The broader Topix fell 0.6 percent to 1,497.27 and the JPX-Nikkei Index 400 slipped 0.7 percent to close the morning session at 13,399.65.
$1 = 119.3100 yen Reporting by Joshua Hunt; Editing by Kim Coghill