* Nikkei dips below 200-day moving average for 1st time since Oct
* Topix falls more than 10 pct from 8-year peak hit 2 weeks ago
* Below 19,000-mark creates buying opportunities - traders
* Sharp rises after sources say it plans tie-up with Hon Hai
By Ayai Tomisawa
TOKYO, Aug 24 (Reuters) - Japanese stocks tumbled to a 5-1/2-month low on Monday morning on a broad sell-off triggered by China growth fears, hitting cyclical stocks hard, including the likes of Toyota Motor Corp and Hitachi Ltd .
Nervousness about a China-led global economic downturn sent the Nikkei down for a fifth day, off 2.7 percent to 18,903.53 in mid-morning trade, the lowest level since March 12. The index dipped below its 200-day moving average of 18,987, the first time since Oct. 2014.
All of the broader Topix ’s 33 subsectors were in negative territory, while the Topix index fell as much as 3.5 percent to 1,518.15, dropping more than 10 percent from an eight-year peak of 1,702.83 hit on August 11.
The China growth scare drove Wall Street to its steepest one-day drop in nearly four years on Friday, while the safe-haven yen rallied to a six-week peak against the dollar.
“Investors were spooked by last week’s Wall Street’s fall and braced for the damage to the Japanese market at the market open,” said Takuya Takahashi, an analyst at Daiwa Securities.
Early on Monday, Chinese share markets tumbled in an ominous sign equity markets for the rest of the day.
Global cyclical stocks led the declines, with the transport equipment sector tumbling 4.2 percent and the electric appliance sector falling 2.6 percent. Toyota dived 4.6 percent, Honda Motor Co shed 4.2 percent, Panasonic Corp declined 2.6 percent and Hitachi fell 3.6 percent.
Financials were also battered after investors grew increasingly risk-averse, with Mitsubishi UFJ Financial Group dropping 4.3 percent, Sumitomo Mitsui Financial Group shedding 5.0 percent and Nomura Holdings falling 4.4 percent.
Some traders said at below 19,000, the Nikkei presented buying opportunities.
“While some investors seem to have been prepared for a worst-case scenario, which is a further market fall, I think the current market level suggests attractive buying opportunities,” said Toru Ibayashi, executive director at UBS Wealth Management, adding that the Nikkei is expected to climb back to 20,000 once the panic sell-off has run its course.
“We also believe central banks (of China, the U.S. and Japan) stand ready to provide support if sentiment worsens further, so the market is likely to recover eventually,” Ibayashi said.
Although there are worries about an expected rate hike by the U.S. Federal Reserve later this year, he said that the Fed can respond to any heightened market uncertainty by delaying the start of monetary tightening, which could ease investor worries.
The JPX-Nikkei Index 400 dropped 2.8 percent to 13,777.33.
Editing by Shri Navaratnam