Nippon Steel H1 profit outlook misses estimates,Technology

 (Reuters) - Nippon Steel Corp, Japan's biggest steelmaker, said it expects an 89 percent drop i n first-half profit, missing market estimates, as an anaemic global economy damps demand for the metal used in automobiles and construction.

Nippon Steel, which will become the world's No.2 steelmaker in October after a merger with Sumitomo Metal Industries , expects recurring profit, or earnings before tax and special items, of 10 billion yen ($127.18 million) fo r the six months to September 30, down from 94.2 billion yen a year earlier.

That compares with a market consensus of 52.7 billion yen, according to Thomson Reuters I/B/E/S.

Global steelmakers including ArcelorMittal are struggling with reduced demand caused by the prolonged debt crisis in Europe and a slower pace of expansion in China, the world's largest consumer. Gains in the yen and shrinking domestic demand have compounded the pain of Japanese steelmakers.

Nippon Steel's April-to-June profit plunged to 9.3 billion yen from 57 billion yen a year earlier, the company said on Monday. That compares with a consensus estimate of 29.07 billion yen. ($1 = 78.6300 Japanese yen) (Reporting by Yuko Inoue; Editing by Ryan Woo)