Tokyo stocks ended slightly down Tuesday, with buybacks of exporters on the back of a weaker yen offsetting most of the earlier losses led by chipmakers.
The 225-issue Nikkei Stock Average fell 22.98 points, or 0.06 percent, from Monday at 38,797.51. The broader Topix index finished 9.59 points, or 0.36 percent, lower at 2,657.24.
On the top-tier Prime Market, decliners were led by bank, insurance and wholesale product issues.
The U.S. dollar strengthened to the mid-147 yen range in Tokyo as the yen was sold after remarks by Bank of Japan Governor Kazuo Ueda at an upper house lawmakers' committee session reduced expectations that the central bank will end its negative interest rate policy at its March meeting.
Tokyo stocks initially faced heavy selling, with the Nikkei benchmark index briefly dropping almost 550 points in the morning amid selling of heavyweight technology and chip-related firms after their counterparts in the United States stumbled overnight.
But falls were scaled back significantly in the afternoon after Ueda's remarks sent the dollar climbing against the yen, bringing exporters such as Sony Group and Nissan Motor back into positive territory.
"The market settled down partly due to the moves on the currency market," said Seiichi Suzuki, chief equity market analyst at the Tokai Tokyo Research Institute.
Gains on the technology-heavy U.S. Nasdaq's futures market also helped dull the initial blow to Japanese high-tech shares.
Investors' caution kept Japanese indexes from rising further, however, as they await the results of the February U.S. consumer price index later in the day, analysts said. The data will offer further clues as to when the Federal Reserve could begin bringing down borrowing costs in the world's largest economy.
