Japan's Nikkei index closed lower on Thursday, with chip-related shares falling despite TSMC reporting better-than-expected earnings, and investors awaiting more earnings data from domestic and foreign companies.
The Nikkei index fell 0.7 percent to its lowest close in a week at 38,911.19, while the broader Topix index fell 0.1 percent to 2,687.83.
Shares of major technology companies fell for a second session, weighing on the Nikkei, after Dutch company ASML cut its annual sales forecast, raising concerns about demand, which had led to a decline in chip-related shares in the previous session.
Technology losses were briefly pared after Taiwan Semiconductor Manufacturing Co., a dominant maker of advanced chips used in artificial intelligence applications, reported a 54 percent jump in third-quarter profit, beating expectations.
Chip testing equipment maker Advantest Co Ltd held up somewhat, closing down just 0.6 percent, while chipmaking equipment giant Tokyo Electron Co Ltd tumbled 3.2 percent, weighing heavily on the Nikkei. Shin-Etsu Chemical Co Ltd fell 1.4 percent.
Shares of chipmaker Disco fell 1.5 percent ahead of earnings reports later in the day.
The selling spread in afternoon trade, with 127 of the 225 stocks on the Nikkei index ending in negative territory, including Fast Retailing, which fell 1.1 percent.
Auto stocks closed higher as the yen retreated to remain near the 150 level against the dollar, supporting exporters, but gains were trimmed since morning.
Subaru shares rose nearly 2.3 percent, Nissan Motor Co rose 1.3 percent and Toyota Motor Co rose 1 percent.
A weaker yen would boost exporters' earnings when they are repatriated in Japanese currency.
Financial stocks rose after their U.S. peers helped Wall Street close higher on Wednesday, with Mizuho Financial Group Inc rising 2.2 percent and Mitsubishi UFJ Financial Group Inc rising 1.9 percent.
