Japanese markets retreated as a stronger yen weighed on automotive stocks such as Honda Motor, Toyota and Nissan, which fell 3-5 percent.
Traders also fretted about the impact of U.S. President-elect Donald Trump's tariff pledges.
The Nikkei average fell 0.80 percent to close at 38,134.97 and the broader Topix index finished 0.90 percent lower at 2,665.34.
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