TOKYO: Tokyo's benchmark stock index closed lower on Monday, snapping a seven-day winning streak with exporters hit by a stronger yen and energy firms tumbling on lower oil prices.
The Organization of the Petroleum Exporting Countries (OPEC) will meet in Vienna on Wednesday, with hopes it will codify a broad agreement struck in Algeria in September to cut production and protect prices.
But crude rates tanked Friday on fears for the agreement as producers clash over its implementation, with Iran and Iraq pressing to be excluded and Russia suggesting it will only freeze output.
News that Saudi Arabia, the kingpin of the OPEC cartel, had walked out of talks on Monday -- and suggested demand will pick up in 2017 -- has led to worries a settlement will not be reached before its twice-yearly meeting.
"Lately we're often seeing cases where the oil market's moves precede those in the equities market," Shoji Hirakawa, chief global strategist at Tokai Tokyo Research Institute, told Bloomberg News.
The Nikkei 225 closed down 0.13 percent, or 24.33 points, at 18,356.89, having ended at an 11-month high Friday.
"Since we've risen so far so quickly, whenever we see falls there are investors who want to buy," said Tsutomu Yamada, an analyst at Kabu.com Securities Co.
But the broader Topix index of all first-section issues ended up 0.34 percent, or 5.05 points, at 1,469.58.
The dollar's sharp rise took a breather with the greenback changing hands at 111.66 yen on Monday against 113.08 yen in New York -- and well off the levels approaching 114 yen seen at the end of last week.
The dollar has risen in tandem with expectations that Donald Trump's presidency will feature big government spending and tax cuts aimed at stoking growth in the world's top economy.
Japanese exporters are sensitive to gains in the yen as a stronger currency tends to dent profits by making their products more expensive abroad while slashing the value of repatriated earnings.
Toyota fell 0.53 percent to 6,653 yen and Sony edged down 0.15 percent to 3,323 yen.
Oil explorer Inpex fell 1.00 percent to 1,088 yen and Japan Petroleum tumbled 2.00 percent to 2,439 yen.
SoftBank sank 1.44 percent to 6,702 yen while Fast Retailing, the operator of Uniqlo clothing stores, dipped 0.26 percent to 41,260 yen.
Banks rose with Mitsubishi UFJ Financial Group up 1.45 percent at 671.3 yen and Mizuho Financial 2.07 percent higher at 202.1 yen.
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