Japan's Nikkei average sank 1.6 percent on Tuesday, its biggest fall in four months, hit by weak retail spending and a rise in the jobless rate in Japan and by drops in other Asian indices. Firms cutting their earnings estimates, such as electronic parts maker Kyocera Corp and retailer Mitsukoshi Ltd, led the decline. Canon Inc, however, rose on its plans to branch out into biotechnology. The slide came despite fresh yen weakness, with the Nikkei ending down 1.63 percent or 192.48 points at 11,599.82, its lowest close since February 24.
The percentage fall was its biggest since November 22, when it lost 2.1 percent, and followed a 53-point rise in the previous three sessions.
The broader TOPIX index fell 1.54 percent to 1,175.62.
"The employment and retail spending figures came in somewhat worse than the consensus," said Koichiro Suzuki, manager of the investment department at Sompo Japan Asset Management.
Government data, released before the market opened, showed Japan's unemployment rate rose unexpectedly to 4.7 percent in February from 4.5 percent a month before.
Average spending by wage earner households, a key gauge of personal consumption, fell a real 3.8 percent from a year earlier and 4.1 percent from January.
Traders said losses in Tokyo were fuelled by large declines in other Asian stock indices, which were hit by weak earnings, economic news and a huge 8.7-magnitude earthquake that struck a small island off Indonesia overnight.
Seoul shares ended down 1.9 percent and Taiwan stocks finished down 1.45 percent at a two-month low.
"We're just kind of seeing world-wide selling of equities," said Charles Lambert, vice president, Japanese equity sales at J.P. Morgan Securities Asia.
Selling was broad-based and large-cap blue chips across the board took a hit, with all of the TOPIX core 30 stocks except Canon losing ground.
Kyocera was one of the biggest losers after it cut its net profit estimate for this business year by 22 percent to 46 billion yen ($429 million), falling 2.8 percent to 7,660 yen.
Department store operator Mitsukoshi slumped 4.9 percent to 568 yen after the company said on Monday it would be deeper in the red for the year ended February 28 due partly to slower sales than expected.
Japan's second-biggest steel maker, JFE Holdings Inc, dropped 4.3 percent to 2,930 yen after it said it halted some operations at a steel plant after coke blew out of one of the blast furnaces.
By sector, issues that rely on the domestic economy came under the most pressure with steel, paper, insurance and brokerages marking the largest declines. Nippon Steel Corp fell 1.8 percent to 271. Oji Paper Co slid 2.4 percent to 604.
In contrast, Canon, Japan's largest electronics issue by market value, edged up on its plans to commercialise DNA chips for use in medical diagnosis. The most actively traded stock by turnover, it rose 0.4 percent to 5,630 yen, extending gains into a fourth session.
Gainers included Ryohin Keikaku Co Ltd, the seller of Muji brand clothing, which rose 3 percent to 5,180 yen after reporting a 35 percent jump in group net profit for the last business year and forecasting an even bigger profit this year.
Decliners overwhelmed advancers 1,419 to 179.
Volume rose to 1.47 billion shares traded, compared with 1.16 billion on Monday, the lowest volume since December 16, 2004.