* Apple suppliers slip on Morgan Stanley (N:MS) iPhone sales outlook
* Toshiba rises on restructuring hopes
By Ayai Tomisawa
TOKYO, Dec 15 (Reuters) - Japan's Nikkei share average fell in choppy trade on Tuesday morning with investors skittish in the face of volatile oil prices and the Fed's momentous interest rate hike decision expected this week.
Apple Inc's AAPL.O component suppliers slid after Morgan Stanley forecast a drop in iPhone sales in the next fiscal year. TDK Corp 6762.T tumbled 3.9 percent, Murata Manufacturing Co 6981.T dropped 2.3 percent and Nitto Denko Corp 6988.T fell 2.8 percent.
The Nikkei .N225 dropped 0.8 percent to 18,737.27 in midmorning trade after briefly flirting with positive territory.
While investors widely expect the Fed to announce its first rate hike in nearly a decade on Wednesday, they are also waiting for commentary from policymakers about what will happen next.
"Investors remain jittery before the event, but after some correction, the market will likely provide bargain hunting opportunities," said Masayuki Kubota, chief strategist at Rakuten Securities. "A U.S. hike signals a U.S. economic recovery, and it is generally positive to the Japanese market."
Selling on global cyclical stocks such as exporters reflected investors' sour risk stance on Tuesday. Toyota Motor Corp 7203.T shed 0.7 percent, Nissan Motor Co 7201.T dropped 1.2 percent and Panasonic Corp 6752.T fell 1.1 percent.
Financials were also lower, with Mitsubishi UFJ Financial Group 8306.T dropping 1.9 percent, Mizuho Financial Group 8411.T sliding 1.7 percent and Nomura Holdings 8604.T declining 0.7 percent.
Toshiba Corp 6502.T outperformed, rising 1.0 percent after the Nikkei business daily reported that it plans to cut up to 7,000 jobs to streamline operations in the wake of an accounting scandal. Responding to the report, the company said it is considering various restructuring options, but nothing has been decided.
The broader Topix .TOPX dropped 0.7 percent to 1,516.96 and the JPX-Nikkei Index 400 .JPXNK400 declined 0.8 percent to 13,641.04.