Japan's Nikkei share average fell on Tuesday, ending below the 9,000 mark as a stronger yen hit exporters such as carmakers while investors steered clear of big positions ahead of the US election result. The euro languished near a two-month low versus the dollar on Tuesday, its outlook clouded by uncertainty over a Greek parliamentary vote on austerity steps needed for Athens to secure international aid.
The Nikkei finished down 0.4 percent at 8,975.15. The broader Topix was also 0.4 percent lower at 744.88. Volume was slightly lower at 1.53 billion shares compared with last week's daily average of 1.8 billion shares.
Traders said that investors stayed on the sidelines ahead of a tight US presidential race.
National opinion polls show President Barack Obama and Republican challenger Mitt Romney in a virtual dead heat, although Obama has a slight advantage in several vital swing states.
"Even after the result is out, there are still negative issues," said Naoki Fujiwara, a fund manager at Shinkin Asset Management. "Worries about the Greek economy linger, therefore people cannot go long." But other analysts said that despite those concerns, investors' risk appetite may return as long as the long-term weak yen trend lasts.
"Investors' eyes will likely continue being glued to the dollar-yen moves, but it's not because corporate earnings are really influenced by tiny currency moves, but the currency moves determine investors' risk appetite," said Yoshito Sakakibara, vice president and economist at J. P Morgan Asset Management.
The euro eased 0.1 percent to $1.2786, staying near the previous day's low of $1.2767 set on trading platform EBS, the single currency's lowest level in about two months. The euro's weakness dragged down carmakers, with Honda Motor Corp shedding 1.0 percent to 2,471 yen and Nissan Motor Corp falling 2.0 percent to 677 yen.
The benchmark Nikkei is up 6.1 percent this year, trailing a 12.7 percent rise in the US S&P 500 and a 11.7 percent gain in the pan-European STOXX Europe 600 index.
Dainippon Screen Manufacturing Co Ltd plunged 16 percent to 406 yen, hitting a three-week low after the precision machinery maker cut its annual forecast to an operating loss of 7 billion yen from a previous estimate of a 3.5 billion yen profit, reflecting a slowdown in demand for semiconductor production equipments. Resources shares gained helped by rising crude prices, with Inpex Corp rising 2.3 percent to 444,500 yen and Mitsubishi Corp adding 0.7 percent to 1,463 yen.
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