TOKYO: Tokyo stocks lost 0.20 percent on Tuesday ahead of the start of a US Federal Reserve policy meeting as investors look for clues on the future of its massive stimulus drive.
The benchmark Nikkei 225 index, which rose 2.73 percent the previous day, closed down 25.84 points to 13,007.28, but the Topix index of all first-section shares rose 0.15 percent, or 1.68 points, to 1,086.40.
"The market is due for some profit-taking, but valuations are technically attractive at current price levels, which should provide decent downside support," said SMBC Nikko Securities general manager of equities Hiroichi Nishi.
Tokyo's dip into negative territory comes after Wall Street got a lift from better-than-expected data on the US housing market and New York-area manufacturing. The Dow Jones Industrial Average finished up 0.73 percent at 15,179 on Monday.
But the focus remains on a Federal Reserve statement and chairman Ben Bernanke's remarks after the Fed's policy-setting committee wraps up a two-day meeting Wednesday.
Speculation buzzed about whether the US central bank will announce a tightening of its $85 billion-a-month asset-buying program, known as quantitative easing, which has been credited with helping support global equity markets.
A Financial Times report said that Bernanke would likely signal the Fed is close to tapering the purchases but would temper that with arguing a move would depend on conditions in the world's largest economy.
A mixed bag of US data recently has pointed to an uncertain recovery with many analysts predicting the Fed would hold off cutting back on the purchases for the time being.
In Tokyo, Panasonic slipped 0.53 percent to 743 yen, mobilephone operator SoftBank declined 0.19 percent to 5,240 yen, while Toyota was up 1.75 percent to 5,800 yen.
Sony jumped 4.41 percent to 2,036 yen after US billionaire Daniel Loeb said he has upped his stake in the electronics giant.
Loeb has repeated his call for Sony to spin off part of its entertainment division, ahead of the firm's annual shareholders meeting on Thursday.
In currency markets, the dollar strengthened to 94.81 yen in Tokyo, from 94.67 yen in US trading on Monday. (AFP)
