Dec. 9 (Bloomberg) -- Japanese stocks fell, with benchmarks having their biggest drops in three weeks. TDK Corp. and Mitsubishi Tokyo Financial Group Inc. dropped after a government report showed machinery orders unexpectedly declined in October, adding to evidence that growth in the world's second-largest economy is slowing.

The report on machinery orders came a day after a separate government report showed that Japan's economy expanded less than some economists expected in the third quarter.

``This is another in a string of disappointing numbers here in Japan,'' said Kirby Daley, a strategist at Societe Generale Securities' Fimat unit in Tokyo. ``This release definitely triggered a sell-off in stocks today.''

The Nikkei 225 Stock Average dropped 164.74, or 1.5 percent, to 10,776.63 at the 3 p.m. close in Tokyo. The Topix index slid 12.13, or 1.1 percent to 1087.56.

Nikko Cordial Corp., the nation's third-largest securities firm, rose 2.7 percent after the Nihon Keizai newspaper said Mizuho Financial Group Inc., Japan's biggest bank by assets, will buy a stake in the brokerage.

To contact the reporter on this story: Michael Tsang in Tokyo at mtsang1@bloomberg.net.

Last Updated: December 9, 2004 01:23 EST