Tokyo stocks close down on profit-taking

Tokyo stocks closed lower on Monday after investors locked in profits in late trading, erasing early gains, as Japan kicked off a new fiscal year with a gloomy business survey.

The benchmark Nikkei 225 index fell 0.31%, or 65.72 points, to 21 388.58 while the broader Topix index was down 0.44%, or 7.52 points, at 1 708.78.

Tokyo shares rose in morning trade, shrugging off fresh data indicating Japan's corporate sentiment weakened.

The Bank of Japan released its closely watched quarterly "Tankan" survey, which showed confidence among Japan's biggest manufacturers has slipped after five quarters of rises.

A higher yen was seen as cooling optimism in the boardroom, but other data shows Asia's number two economy has been expanding steadily along with the global economy.

In late trading, profit-taking emerged with many investors adjusting their positions before trading resumes overseas following the Easter holidays, said Hikaru Sato, senior technical analyst at Daiwa Securities.

"All eyes are on the opening in New York following the holidays," Sato told AFP.

"The near-term prospect for Japanese shares largely depends on moves in New York," he added.

Players will be looking to US jobs data to be released on Friday to gauge their future course of action, brokers said.

While Japanese shares have been range-bound in recent trading, some risks remain going forward, Rakuten Securities said.

The possibility of a trade war between the United States and China, the yen's appreciation, and political uncertainty in Japan and the US were among factors that could drive down shares in the immediate future, it said in a note.

Among major shares, Toyota lost 0.67% to 6 779 yen and Nissan edged down 0.04% to 1 103.5 yen.

Panasonic fell 0.46 percent to 1,514 yen and SoftBank Group dropped 1.09 percent to 7,863 yen.

But Sony rose 0.52 percent to 5,173 yen, with Fast Retailing up 0.43 percent at 43,430 yen.

The dollar, which plunged below 105 yen in late March, changed hands at 106.37 yen in afternoon trade, up from 106.16 yen on Friday.