TOKYO: Stocks in Tokyo and Shanghai lost ground Monday in quiet trading with most of the region's other key markets closed for public holidays.
Both Japan and China declined as investors cashed in on a recent global rally fuelled largely by expectations for the incoming administration of US President-elect Donald Trump.
Incentives were few and the Dow Jones Industrial Average, which on Friday again fell short of 20,000 points in light trade ahead of the holiday weekend, provided no tailwind.
In Tokyo, the benchmark Nikkei 225 index, which closed on Friday for a national holiday, fell 0.09 percent by the break.
"Selective shares are facing profit-taking following the recent gains, as many investors are on the sidelines in a holiday mood, looking to fresh factors to trade," said Shinichi Yamamoto, broker at Okasan Securities in Tokyo.
Japan's banking sector remained under selling pressure on negative news in the sector from overseas.
Italy on Friday approved a state-funded rescue of the world's oldest bank, Monte dei Paschi di Siena (BMPS), while Deutsche Bank and Credit Suisse agreed to pay a total of almost $12.5 billion to settle disputes over the sale of mortgage-backed securities during the global financial crisis.
Japan's MUFG dropped 1.40 percent by the break with its rival Sumitomo Mitsui Financial Group down 1.32 percent.
"There are very few market participants around at the end of the year, and with some short-term overbuying, Japanese stocks may keep adjusting their levels," Shoji Hirakawa, chief global strategist at Tokai Tokyo Research Institute Co, told Bloomberg.
Chinese shares, meanwhile, opened lower, dragged down by heavyweight securities brokerages and banking shares, dealers said
The benchmark Shanghai Composite Index dropped 0.47 percent, while the Shenzhen Composite Index, which tracks stocks on China's second exchange, lost 0.40 percent.
Currency markets were also quiet.
"The undercurrent is still a strong dollar, but there was an adjustment phase in the past few days after a surge on expectations for Mr Trump," Marito Ueda, senior dealer at FX Prime, told AFP.
Sentiment favouring a strong dollar "will likely continue until Mr Trump actually takes office in January and maybe during the so-called 'honeymoon period', or 100 initial days of his government, unless some geopolitical risks emerge," Ueda added.
The greenback traded at 117.14 yen, down from 117.31 yen Friday in New York.
The euro, meanwhile, fell slightly, trading at $1.0451 from $1.0454 on Friday.
- Key figures around 0230 GMT -
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Tokyo - Nikkei 225: DOWN 0.09 percent at 19,410.43 (break)
Shanghai - Composite: DOWN 0.47 percent at 3,095.58.
Euro/dollar: DOWN at $1.0451 from $1.0454 Friday
Dollar/yen: DOWN at 117.14 yen from 117.31 yen
Pound/dollar: DOWN at $1.2284 from $1.2291
Oil - West Texas Intermediate: $53.02 per barrel (Friday close)
Oil - Brent North Sea: $55.16 (Friday close)
New York - Dow: UP 0.1 percent at 19,933.81 (Friday close)
London - FTSE 100: UP 0.1 percent at 7,068.17 (Friday close)
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