* Nikkei’s drop extends as USD falls below 113 yen
* Japan’s Q4 GDP has little impact but does not help mood
* SoftBank outperforms after announcing reorganization plan
By Ayai Tomisawa
TOKYO, March 8 (Reuters) - Japan’s Nikkei share average fell to a near one-week low on Tuesday as a stronger yen kept investors on edge, dragging down stocks across the board.
The dollar dipped below 113 yen in early morning trade. At 0149 GMT, the pair stood at 112.85.
The Nikkei fell 1.8 percent to 16,610.06 points by midmorning, after touching as low as 16,599.73, the lowest since March 2.
In particular, exporters took a hit, with Toyota Motor Corp falling 1.6 percent, Honda Motor Co dropping 2.0 percent and Nissan Motor Co tumbling 3 percent.
As investors have become risk averse, financials also lost ground. Mitsubishi UFJ Financial Group shed 3.2 percent, Mizuho Financial Group declined 1.6 percent and Nomura Holdings dropping 2.5 percent
Japan’s fourth-quarter economic data released before the market open had a limited impact to the stock market, but it did not help sentiment, either.
The data showed the world’s third-largest economy contracted less than initially estimated in the final quarter of 2015, but private consumption remained weak, underscoring the challenges facing premier Shinzo Abe in restoring growth amid intensifying overseas headwinds.
“While the economy is stagnant, the Bank Of Japan imposed a negative interest rate policy. There are lots of concerns in the market, and the government needs to come up with a growth strategy and fiscal policy to lift the economy and the mood,” said Nobuhiko Kuramochi, a strategist at Mizuho Securities.
Kuramochi said that the market will likely continue taking cues from the currency market and oil prices, while investors will keep an eye on the central banks’ policies ahead.
Suzuki Motor stumbled more than 4 percent after the automaker said it will issue 200 billion yen in zero-coupon convertible bonds while it will cancel Volkswagen shares.
Bucking the weakness, SoftBank Group Corp rose as high as 3.8 percent after announcing a reorganization plan.
The broader Topix dropped 2.1 percent to 1,333.07 and the JPX-Nikkei Index 400 declined 2.1 percent to 12,063.49. (Editing by Kim Coghill)