Nikkei stays below 11,000 mark

The slide on Wall Street sent Asian markets down on Friday

TOKYO, Japan -- The slide on Wall Street sent Tokyo's benchmark Nikkei 225 average plunging to a fresh 17-year low on Friday morning before it rebounded to 10,803.16 by midday.

This was still a drop of 135.29 points or 1.24 percent on Thursday's close.

Along with Wall Street's fall -- Nasdaq dropped 2.8 percent and the Dow fell below 10,000 -- Friday's announcement of a decline in Japanese household spending and a further drop in the consumer price index had investors worried.

Elsewhere in the region, key market indicators in Australia, Korea, Taiwan and Hong Kong also fell in the morning session.

News, Telstra weaker in Australia

Australia's S&P/ASX200 was down 36.2 points or 1.1 percent to 3287.7 on continued weakness among heavyweights News Corp, Telstra and BHP Billiton.

In Seoul the Kospi slipped 16.7 points or almost 3 percent to 547.57. Embattled chipmaker Hynix Semiconductor contined to fall and was trading at 875 yen at midday.

The Nikkei stayed below 11,000 Friday morning, after Thursday's close of 10,938.45

In Tokyo, traders also focused on the yen, which strengthened to about 119 to the U.S. dollar. A stronger yen erodes exporters' overseas revenues when repatriated into the Japanese currency.

"When the Nikkei falls eight percent below the 25-day moving average like this morning, traders are inclined to cover their short positions. But the stronger yen capped Tokyo's upward potential," said Kunihiro Hatae, general manager of equities trading at Tokai Tokyo Securities.

High-tech sector takes further battering

The broader capital-weighted TOPIX index lost 5.73 points or 0.51 percent to 1,108.85, after briefly falling below the key 1,100 mark for the first time since March 1999.

The high-tech sector, under pressure from the Nasdaq fall, was battered further by fresh profit warnings.

Japanese high-tech stocks fell on further earnings warnings

Consumer electronics maker Sanyo Electric Co Ltd fell 3.75 percent to 539 yen after it said it will announce a downward earnings revision later in the day.

Calculator and digital watch maker Casio Computer Co Ltd fell 2.99 percent to 715 yen after its profit warning earlier in the morning.

Major banks turned higher after starting Friday trade sharply lower, in a rebound from their recent tumble.

Mizuho Holdings Inc, which had lost more than 10 percent over the previous two sessions, rose 3.96 percent to 499,000 yen and Mitsubishi Tokyo Financial Group gained 2.02 percent to 1.01 million yen.

Reuters contributed to this report.