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Japanese stocks stepped back on Wednesday morning as heavyweight Softbank tumbled after slashing its profit forecast, while the broader market took a breather after outsized gains inspired by a fresh stimulus drive by the Bank of Japan.
The Nikkei benchmark soared 7.5% in the last two trading days, sending the index to its highest point since before the collapse of Lehman Brothers.
Tuesday also saw the second highest turnover of shares on record, as investors cheered the BOJ's policy announcement on Friday, as well as the Government Pension Investment Fund's decision to increase its allocation of funds to domestic stocks.
The Nikkei slipped 0.3% to 16,809.40 at 0127 GMT, but hovered around 7-year highs.
"The market's slack after the last couple of days. We're seeing investors taking profits this morning," said Takashi Hiroki, chief strategist at Monex in Tokyo.
Dragging the Nikkei down some 32.5 points was heavyweight Softbank Corp, which fell 2.4%. The fast-growing telecom firm slashed around $1 billion off its annual profit forecast as Sprint Corp, the US carrier it bought last year, sheds customers.
On the positive ledger, Honda Motor Co Ltd jumped 1.8%, while Nikon added 1.3%. Nissan Motor Co Ltd advanced 1.0% after it beat second quarter operating profit estimates.
Investors are also focused on key earnings reports from the likes of Toyota Motor Corp and e-commerce firm Rakuten Inc, both due after the closing bell.
A pause in the dollar's recent rally, which gave the yen some breathing space after a bruising selloff following the BOJ jolt, kept some exporters subdued.
The dollar bought 113.66 yen, moving away from the seven-year high of 114.21 reached on Monday.
Overall, market players expect Friday's announcements to continue to underpin the market, with the real estate and financial sectors picked as major beneficiaries.
"The BOJ has put to rest any concerns about (Governor Haruhiko) Kuroda's commitment to achieving his target," said Stefan Worrall, director of equities cash sales at Credit Suisse, referring to the central bank's commitment to meeting its 2% inflation goal in fiscal 2015.
"The BOJ and GPIF are going to have to be doing a lot of buying of Japanese equities."
The broader Topix was down 0.5% at 1,361.85, while the JPX-Nikkei Index 400 lost 0.3% to 12,475.73.
