Nikkei down 2.4 pct at 2-month low as banks drag

(Updates to midafternoon)

TOKYO, July 8 (Reuters) - The Nikkei stock average slid 2.4 percent on Tuesday to a two-month low, dragged down by financials such as top lender Mitsubishi UFJ Financial Group (8306.T: Quote, Profile, Research) amid renewed credit fears.

The slide came just a day after the benchmark snapped a 12-day losing streak, in which it lost 8.4 percent and marked its longest losing run since a 15-day stretch in 1954.

Aeon Co Ltd (8267.T: Quote, Profile, Research), Japan's No. 2 retailer, skidded 5.6 percent to 1,231 yen ahead of its first-quarter earnings results due after the closing bell. Retailers are facing a tough market, as rising prices of fuel and food have forced consumers to trim spending on other items.

Soichiro Monji, chief strategist of the equity management department at Daiwa SB Investments, said the Japanese market extended losses in the afternoon following sharp drops in other Asian markets, with most of them hit by U.S. financial worries.

"The focus of the Japanese market is shifting to potential further losses or capital increases by financial institutions as we get closer to their earnings announcements in the United States," Monji said.

"During the Nikkei's 12-day losing streak, investors were more worried about high oil prices and the economic outlook than financial problems," he said.

As of 0407 GMT, the benchmark Nikkei .N225 fell 324.57 points to 13,035.47, hitting its lowest since April 15.

The broader Topix shed 2 percent to 1,286.23.