* Firms with large exposure to China underperform
* Global trade tensions, U.S. foreign policy unnerve market
* Nikkei has dropped 4.0 percent for the week
TOKYO, March 23 (Reuters) - Japan's Nikkei share average tumbled on Friday to its lowest level since mid-October on concerns over escalating global trade tensions that triggered a spike in the yen.
U.S. President Donald Trump signed a presidential memorandum on Thursday that will target up to $60 billion in Chinese goods with tariffs. They will kick in after a 30-day consultation period.
Japan's benchmark Nikkei dropped as much as 3.9 percent to 20,745.51, its lowest point since October 10.
That left it nursing losses this week of 4.0 percent, which would be the biggest weekly percentage fall since early February.
Japanese companies with high exposure to the world's second-biggest economy fell sharply.
Industrial robot maker Fanuc Corp tumbled 5.8 percent, semiconductor equipment makers Advantest and Tokyo Electron dropped 4.3 percent and 5.0 percent, respectively.
Machine tool makers also underperformed, with Makino Milling Machine dropping 5.0 percent and Okuma Corp stumbling 6.4 percent.
"The market started to worry how the global trade tensions will affect the real economy, and right now people are avoiding risks," said Masahiro Yamaguchi, a senior market analyst at SMBC Trust Bank.
News that Trump replaced H.R. McMaster as national security adviser with John Bolton, a hawk who has advocated using military force against North Korea and Iran, also hurt investor sentiment.
"Uncertainty over foreign policy of the Trump administration is increasing and it may last for a while," Yamaguchi said.
The dollar fell as low as 104.635 yen in early Asian trade on Friday, its lowest level since November 2016, stoking concerns that the Japan'ese currency's strength will sap the earnigns of Japanese companies.
Exporters were sold off, with Honda Motor Corp falling 3.7 percent, Nintendo Co dropping 3.2 percent and TDK Corp shedding 5.0 percent.
Analysts said a strong yen would impact profits of exporters, but companies were still likely to post growth next fiscal year as long as the global economy continues to expand.
"At this dollar-yen level, it makes sense that the market is worried. But the economy is strong so far," said Kazuhiro Takahashi, an equity strategist at Daiwa Securities.
Even if the dollar trades at 105 yen throughout the next fiscal year starting in April, companies are expected to post a 6.2 percent rise in their pre-tax profits, Takahashi said.
The broader Topix declined 2.6 percent to 1,683.00, with 32 of its 33 subsectors in negative territory. (Reporting by Ayai Tomisawa; Editing by Neil Fullick)