Tokyo's Nikkei average ended down 0.01 percent on Friday, a touch off the previous day's four-year high as weaker-than-expected GDP and a higher yen prompted selling in JFE Holdings and other recent gainers.
Disappointing earnings from Dell Inc, the world's largest personal computer maker, and subsequent falls in its shares along with those of its supplier Intel Corp weighed on Fujitsu Ltd and other PC-related stocks. Government data showed Japan's economy grew 0.3 percent in April-June from the previous quarter compared with a forecast of 0.5 percent growth in a Reuters poll of economists.
"The market had gone a bit overboard and investors wanted to take a break. The GDP numbers were used as an excuse to take profits," said Toshihiko Matsuno, assistant general manager at SMBC Friend Securities.
The Nikkei edged down 1.64 points to 12,261.68, after marking a four-year closing high of 12,263.32 on Thursday.
The benchmark gained 4.21 percent on the week, the biggest weekly gain since the five days ended March 5, 2004. The broader TOPIX index edged up 0.11 percent to 1,245.13.
It was the best close for the TOPIX since July 12, 2001, when it finished at 1,248.63. Investors locked in profits in steel shares, which had drawn buyers as high-dividend plays, with JFE losing 1.6 percent to 3,070 yen.
Profit taking also hit oil stocks, which had logged hefty gains as crude prices hit record highs. Oil and gas explorer Inept Corp shed 2.9 percent to 826,000 yen after having risen 14 percent this week.
Japan's largest refiner, Nippon Oil Corp, slipped 0.6 percent to 868 yen.
In the technology sector, Fujitsu dropped 1.2 percent to 645 yen and NEC Corp fell 1.4 percent to 575 yen.
Deutsche Securities analyst Fumiaki Sato said in a report on Friday that Japan's electric machinery sector was expected to underperform the market given an expected softening in global technology stocks.
Another notable loser was Sony Corp, which fell 1.8 percent to 3,730 yen. Standard & Poor's Ratings Services said on Friday that if it decides to downgrade its credit rating on the struggling electronics maker, it would likely be one notch and at most two notches.
Masaki ISO, chief investment officer at Yasuda Asset Management Co, said high-tech companies have a tough time ahead. "The high-tech companies were struggling to clear their inventories.
Demand has not picked up much, making it hard for them to make a strong recovery," he said. Auto stocks fell as the dollar stayed near a six-week low against the yen.
Honda Motor slipped 0.5 percent to 5,760 yen and Nissan Motor Co lost 1 percent to 1,173 yen. Trade volume edged down, with 1.90 billion shares changing hands, although it still remained well above last year's daily average of 1.45 billion shares.
Decliners topped advancers, 932 to 590.