Japan's Nikkei edges lower, tech a mixed bag
Overnight, as the Nasdaq came further off last week's record highs, the NYFANG index, which tracks 10 heavily traded tech names, fell 1.8%.
Meanwhile, in comments on Tuesday, Federal Reserve Chair Jerome Powell kept alive market expectations of a rate cut at the Fed's upcoming July 29-30 meeting, prompting investors to slightly boost the possibility of a reduction.
At home, Japanese investors are keeping an eye on key upper house elections slated for July 20 and the prospect of a trade deal with the United States, which President Donald Trump has indicated might not happen by his July 9 deadline for higher tariffs.
At 0235 GMT, the Nikkei index fell 392.61 points, or 1%, to 39,593.72.
While it is down more than 3% this week, the index has risen nearly 11% since April 2, when Trump unveiled his reciprocal tariffs.
Kenji Abe, chief strategist at Daiwa Securities, said the Nikkei's strength was owing to expectations for rate cuts by the Fed and the rally in global semiconductor shares over the past month.
'Part of the market participants expected the news that the trade negotiations between Japan and the US are not going well because it took such a long time and some people also expected the trade negotiation regarding auto tariffs not going well,' he said.
'So the news that Japan may not reach agreement with the US is not that surprising.'
Tokyo has been scrambling to convince the US to scrap a 25% tariff on Japanese cars and a 24% reciprocal tariff on other Japanese imports. The reciprocal tariff has been paused until July 9, but Japan has yet to secure a trade deal after nearly three months of negotiations.
The broader Topix slipped 0.5%.
The largest percentage gainer in the index was Renesas Electronics Corp, up 3.24%.
The biggest decliners in the index were Konami Group Corp , down 6.48%, followed by Kawasaki Heavy Industries losing 5.04% and Fujikura, falling 4.67%.
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