Stocks fell back on the Tokyo Stock Exchange on Tuesday, pressured by the yen’s strengthening against the dollar.
The 225-issue Nikkei average lost 92.18 points, or 0.43 percent, to end at 21,193.81, after gaining 27.35 points on Monday.
The Topix index of all first-section issues closed down 4.25 points, or 0.27 percent, at 1,543.49. It edged up 1.84 points the previous day.
Tokyo stocks were mixed in the morning session, as investors continued to refrain from active trading ahead of an expected meeting between U.S. President Donald Trump and Chinese President Xi Jinping on the sidelines of a Group of 20 summit in Osaka later this week, brokers said.
The yen’s sustained strength weighed on the stock market, brokers said.
Both the Nikkei and Topix indexes stayed in negative territory throughout afternoon trading, as the dollar slipped below ¥107 in Tokyo trading for the first time since early January following a Bloomberg report on Trump’s recent private conversations with confidants about the United States withdrawing from the security treaty with Japan, brokers said.
“Amid a dearth of fresh incentives, the Bloomberg report likely triggered futures-led selling,” said an official of a Japanese brokerage firm.
“The lack of strong buying interest facilitated the market’s drop in the afternoon,” said Masayuki Otani, chief market analyst at Securities Japan Inc.
Subdued trading is expected to continue “unless the direction of the U.S.-China trade dispute becomes clear,” Otani said.
Falling issues outnumbered rising ones 1,209 to 821 in the TSE’s first section, while 114 issues were unchanged.
Volume increased to 1.02 billion shares from 830 million Monday.
The stronger yen hit export-oriented names, among them automaker Toyota and industrial robot producer Yaskawa Electric.
Japan Display plunged 9.09 percent after its announcement Tuesday of the withdrawal of a major Taiwanese financial group from talks on a capital injection into the financially troubled liquid crystal display panel maker.
Among other major losers were clothing store chain Fast Retailing and drug maker Eisai.
By contrast, major mobile phone carriers NTT Docomo, KDDI and SoftBank fared well as investors sought safe bets, brokers said.
Furniture retailer Nitori gained 2.46 percent thanks to a rise in same-store sales between May 21 and Thursday.
Also on the positive side were railway operator JR East and construction machinery maker Komatsu.
In index futures trading on the Osaka Exchange, the key September contract on the Nikkei average dropped 150 points to end at 21,080.