Tokyo stocks have fallen 0.54 per cent, following Wall Street lower after disappointing data on US housing and consumer confidence.
The Nikkei-225 index ended down 80.63 points on Wednesday at 14,970.97, while the Topix index of all first-section shares fell 0.67 per cent, or 8.31 points, to 1,225.35.
In the United States the Case-Shiller index for home prices in 20 leading cities fell 0.1 per cent in December, the second straight monthly decline. The Conference Board said its consumer confidence index fell to 78.1 in February from 79.4 in January.
On Wall Street Tuesday the Dow slipped 0.17 per cent, the S&P 500 fell 0.13 per cent and the Nasdaq gave up 0.13 per cent.
However, the Nikkei's losses are likely limited as long as the US dollar stays around current levels against the yen, said Mitsushige Akino, chief fund manager at Ichiyoshi Investment Management.
The US dollar edged up to Y102.32 Wednesday afternoon from Y102.22 in New York Tuesday afternoon.
The euro bought $US1.3739 and Y140.58 compared with $US1.3744 and Y140.49 in US trade.
A weak yen is positive for Japanese exporters as it makes their products more competitive abroad and inflates profits when repatriated.
Panasonic jumped 5.26 per cent to Y1,259 following news reports that it and California-based electric-vehicle venture Tesla Motors are in talks to build an automotive battery plant in the United States.
Honda fell 0.13 per cent to Y3,705 on reports that it plans to end the production of Insight, the company's first hybrid vehicle, at the end of February.
Toyota slipped 1.21 per cent to Y5,917 while Nissan fell 0.32 per cent to Y917.
