The benchmark Nikkei 225 index lost 1.94 percent or 418.56 points to 21,122.43 in early trade while the broader Topix was down 1.82 percent or 28.48 points at 1,538.87.

"Selling will likely lead trade following sharp drops in US stocks and the yen's rise," Okasan Online Securities said in a note.

"There are fresh signs that US-China trade frictions are worsening again" while investors are likely to stay away from buying ahead of the weekend, it added.

After Tokyo closed on Thursday, US President Trump's new tariffs on China sent a shockwave through global markets.

He announced the tariffs on another $300 billion in Chinese goods, aborting an equity market rally following the Federal Reserve's decision Wednesday to cut interest rates for the first time in more than a decade.

The dollar tumbled against the yen, a negative development for Japanese exporters.

The greenback was trading at 107.45 yen, almost flat from 107.40 yen in New York Thursday afternoon but well below the 108-yen rage seen when Tokyo closed for the day.

Automakers were broadly lower on a stronger yen.

Toyota was down 1.63 percent at 6,976 yen, hours ahead of its announcement of first-quarter results, while Honda fell 1.98 percent to 2,668 yen.

IT investor SoftBank Group dropped 2.47 percent to 5,552 yen and Nintendo lost 1.42 percent to 40,850 yen.