Solid investor appetite for undervalued stocks after the Nikkei index lost more than 6% to a 16-month low in the past three trading days initially boosted the market.
At closing bell, the 225-issue Nikkei Stock Average fell 73.42 points, or 0.3%, to 24,717.53, its lowest since November 2020. The broader Topix index of all First Section issues on the Tokyo Stock Exchange declined 0.97 point, or 0.06%, to 1,758.89.
Total 21 of 33 TSE issues declined, with bottom performing sectors were Electric Power & Gas, Marine Transportation, Precision Instruments, Pharmaceutical, and Warehousing & Harbor Transportation Services, while top gaining issues included Rubber Products, Air Transportation, and Banks.
Market participants grappled under selloff pressure amid worries about inflationary risks and a slowdown in the global economy following the surge in oil prices as President Joe Biden officially announced a U.S. ban on the import of Russian oil, liquefied natural gas, and coal in response to Russia's unprovoked invasion of Ukraine.
Britain said the same day it would phase out imports of Russian oil by the end of the year, while the European Union unveiled a plan to eventually become independent from Russian fossil fuels.
Nikkei blue chips stocks were mostly lower, with staffing agency Recruit Holdings falling 4.46%, while soy sauce maker Kikkoman lost 6.67%.
Kikkoman plunged 6.7% to 7,840 yen, on worries that soaring soy and wheat prices amid the Ukraine crisis could raise production costs at the soy sauce maker.
Shares of export related were mostly higher, as the yen weakened slightly overnight against the U.S. dollar. Honda Motor rose 0.8% to 3,069 yen, Mitsubishi Motors was up 1.2% at 257 yen and Mazda Motor gained 1.7% to 727 yen.
ECONOMIC NEWS: Japan GDP Expands 4.6% on Year in Q4- Japan's gross domestic product expanded an annualized 4.6% on year in the fourth quarter of 2021, the Cabinet Office said on Wednesday following the downwardly revised 2.8% contraction in the previous three months. On a seasonally adjusted quarterly basis, GDP was up just 1.1% after shrinking 0.7% in the three months prior. Capital expenditure added 0.3% on quarter, after contracting 2.4% in Q3. External demand rose 0.2% on quarter, up from 0.1% in the third quarter.
CURRENCY NEWS: The Japanese yen traded at 115.83 per dollar, weaker than levels below 115.2 seen against the greenback earlier this week.
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