TOKYO - Tokyo shares drifted lower on Monday morning as the global high-tech sector faces pressure.
The benchmark Nikkei 225 index eased 0.31 percent, or 86.81 points, to 28,196.22, while the broader Topix index fell 0.16 percent, or 3.17 points, to 2,014.83.
The dollar stood at 139.01 yen, nearly unchanged from 139.03 yen seen Friday in New York.
The market continues to see support from speculation that the speed of US rate hikes will slow, though profit-taking was weighing on the market.
The Nasdaq fell 0.5 percent on Friday, adding pressure on global semiconductor shares, while the Dow's gain of 0.5 percent on the same day was seen as a positive sign.
"In recent weeks, equity investors have been buoyed by expectations that central banks' job to bring inflation down could be facing a turning point, following a lower-than-expected US CPI print," Rodrigo Catril of National Australia Bank said in a note.
Investors are now awaiting Fed Chair Jerome Powell's congressional address on Wednesday, followed by a barrage of key US indicators to be released on Thursday, including household spending, payrolls and manufacturing activities, he added.
Japanese shares have firmed recently on hopes that US inflation will soon be tamed, Rakuten Securities said.
The US economy is decelerating but still solid. The Japanese economy is also recovering on the back of economic reopening and the yen's depreciation, the brokerage said.
"Japanese shares are relative bargains, and in the long run it is a good time to buy," Rakuten said, while also warning about possible "rapid volatility" in the short term.
The global market is now also focusing on China, where citizens have staged rare protests against the country's strict zero-Covid policy.
"Social discontent could increase in China over the coming months, testing policymakers' resolve to stick to the Covid zero mandates," Stephen Innes of SPI Asset Management wrote in a note.
"Mass protests would deeply tilt the scales in favour of an even weaker economy and likely be accompanied by a massive surge in Covid cases, leaving policymakers with a considerable dilemma," he said.
Among major shares, semiconductor-related issues were hit hard.