The benchmark Nikkei 225 index slid 0.91 percent or 187.25 points to 20,489.97 in early trade while the broader Topix index fell 0.98 percent or 14.82 points to 1,491.95.

"There is a lack of trading incentives locally, so shares are likely to be influenced by factors outside Japan," Yoshihiro Ito, Okasan Online Securities chief strategist, said in a note.

On Wall Street, stocks slid further after President Donald Trump once again said he was not ready to reach a trade deal with China.

The Dow Jones Industrial Average lost 0.7 percent, while the broad-based S&P 500 fell 0.8 percent. The tech-rich Nasdaq Composite Index shed 0.7 percent.

In Europe, Italian Prime Minister Giuseppe Conte resigned after lashing out at far-right Interior Minister Matteo Salvini for pursuing his own interests by pulling the plug on the governing coalition.

The move leaves the eurozone's third largest economy in a political vacuum until President Sergio Mattarella decides whether to form a new coalition or call an election after talks with parties in the coming days.

In Tokyo trading, IT investor SoftBank Group dropped 2.32 percent to 4,822 yen, while Sony lost 0.43 percent to 5,939 yen.

Uniqlo chain operator Fast Retailing climbed 0.25 percent to 62,870 yen.

The dollar traded at 106.33 yen in early Asian trade, against 106.23 yen in New York Tuesday afternoon.