Japan's Nikkei share average fell back from its highest point in nearly five years on Tuesday as concern about the strength of the US holiday shopping season helped drive down exporters such as Sony Corp.
Tech stocks such as Advantest Corp fell across the board due to worries they had risen too quickly during the benchmark's eight-day rally that lasted until on Monday.
But investors returned to banks and other stocks reliant on the domestic economy, sending the broader TOPIX index into positive territory.
During the session it rose to 14,995.08, it's highest since December 2000. It rose 6.4 percent during the previous eight sessions, its longest rally since March. The TOPIX finished up 0.07 percent at 1,544.57. US retailers lost ground on Monday as investors worried that deep discounting drove business at many retailers, raising concerns about profitability.
Consumer electronics giant Sony, which made 71 percent of its sales overseas last business year, fell 1.8 percent to 4,450 yen.
Canon Inc, the world's top maker of cameras and copiers, gave up 0.4 percent to 6,770 yen. Sharp Corp, the world's largest maker of liquid crystal display televisions, lost 1.3 percent to 1,880 yen.
Advantest, the world's biggest maker of microchip-testing devices, fell 2.2 percent to 11,240 yen. On Monday it hit a three-year closing high of 11,490, up 37 percent this month.
Electronics parts maker TDK Corp, fell 0.7 percent to 10,090 yen after hitting a four-year closing high on Monday. Tokyo Electron Ltd, the world's second-largest maker of chip-making tools, declined 1.6 percent to 7,360 yen.
Technical indicators showed aggressive gains by tech stocks had pushed the Nikkei average too high in a short period, Tachibana's Hirano said.
On Monday's close, the benchmark's 14-day relative strength index had hit 93. Analysts usually consider a number above 70 as a signal of overbuying.
Mitsubishi UFJ Financial Group Inc, the world's top lender by assets, rose 1.3 percent to 1.55 million yen.
Mizuho Financial Group Inc, Japan's second-largest bank, gained 0.4 percent to 861,000 yen. Third-ranked Sumitomo Mitsui Financial Group Inc added 0.9 percent to 1.15 million yen.
The Topic's banking sector sub-index IBNKS.has risen 49 percent so far this year, boosted by expectations that Japan is ready to emerge from over seven years of deflation.
The electrical machinery sector IELEC.has advanced only 25 percent. Analyst Fumiaki Sato of Deutsche Securities said in a note to clients on Tuesday that without overseas help, tech stocks may remain a laggard.
"Japan's electronics stocks are now gaining momentum after having lagged the broader market, but we believe a sustained rise is unlikely in the absence of one overseas," Sato said.
Citing a decline in global competitiveness and high valuations, Sato said Japanese techs could fall in the near future.
Trading edged up, with 2.08 billion shares changing hands on the Tokyo exchange's first section against on Monday's 2.05 billion, a four-week low. Gainers outnumbered decline's 1,029 to 540.
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