TOKYO: Tokyo's benchmark Nikkei index gave up gains and succumbed to profit-taking in morning trade on Wednesday, even as global markets advanced on upbeat US retail data.
The Nikkei 225 opened comfortably in the black but dropped 0.24 percent, or 72.16 points, to 29,735.96 by mid-morning.
The broader Topix index also gave up earlier gains and slipped 0.44 percent, or 9.02 points, to 2,041.81.
The dollar stood at 114.75 yen, edging down from 114.80 yen in New York overnight but up from 114.16 yen in Tokyo on Tuesday.
"The Nikkei slipped into negative territory following a round of buying," Okasan Online Securities said.
"But there is only a limited sense that investors are rushing to dump shares."
The Tokyo market was initially supported by advances in all three major US indices after US retail sales jumped 1.7 percent in October, reflecting increasing consumer optimism.
Investor sentiment has been bolstered by a solid corporate earnings season, and Edward Moya, OANDA senior market analyst for the Americas, said more gains could be on the way.
"All signs are pointing to a very strong holiday season for retailers, and that should help keep sending stocks higher," he said.
Okasan Online, which expected the Nikkei to gradually rebound, said some Tokyo shares remain vulnerable to profit-taking, with caution about overheating expected to reemerge.
"Still some shares in Tokyo remain vulnerable to profit-taking. The Nikkei index remains so close yet so far from the target of 30,000 yen," Okasan added.
Shortly before the opening bell, the Japanese government said the world's third-largest economy logged a year-on-year trade deficit in October for the third straight month.
Imports grew 26.7 percent for the ninth straight monthly gain, overwhelming a 9.4 percent growth of exports.
Among Tokyo shares, energy firms rose despite the Nikkei's fall, on reports that the government is planning subsidies for oil refiners to counter a rise in oil prices.
Energy developer INPEX jumped 2.54 percent to 1,010 yen.
Top refiner ENEOS Holdings trimmed gains but was 0.16 percent higher at 451 yen. Its rival Idemitsu Kosan rose 1.32 percent to 3,075 yen.
Semiconductor shares continued to gain. Tokyo Electron advanced 2.81 percent to 60,660 yen. Advantest rose 2.05 percent to 10,430 yen.
Tech investor SoftBank Group rose 0.97 percent to 7,182 yen. Toyota added 1.05 percent to 2,164 yen.
Airline ANA Holdings dropped two percent to 2,719.5 yen. Uniqlo operator Fast Retailing fell 1.08 percent to 75,120 yen.
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