The Japanese stock market has pared earlier losses and is modestly lower on Wednesday following the weak cues from Wall Street and on a flat yen. Nevertheless, upbeat Japanese industrial output data helped boost investor sentiment.
In late-morning trades, the benchmark Nikkei 225 Index is down 11.65 points or 0.05 percent to 23,280.32, off a low of 23,184.00 in early trades.
The major exporters are higher on a slightly weaker yen. Panasonic is adding 0.6 perecnt, Sony is higher by 0.8 percent, Mitsubishi Electric is advancing more than 1 percent and Canon is rising more than 2 percent. Meanwhile, SoftBank Group's shares are lower 0.7 percent.
NEC Corp's shares are rising more than 4 percent after the electronics maker said Tuesday that it will cut 3,000 jobs and also close some of its plants in Japan in a bid to reduce costs.
Among automakers, Toyota is down 0.1 percent and Honda is declining more than 1 percent. In the banking sector, Sumitomo Mitsui Financial is losing 0.3 percent and Mitsubishi UFJ Financial is lower by 0.5 percent.
In the oil space, Inpex is losing 0.6 percent and Japan Petroleum Exploration is down 0.2 percent after crude oil prices extended losses overnight.
Among the market's best performers, Yokogawa Electric is gaining more than 5 percent and Advantest Corp is rising more than 4 percent.
On the flip side, Tokyo Electron is losing more than 4 percent, Kobe Steel is lower by more than 3 percent and Nisshin Steel is down almost 3 percent.
On the economic front, the Ministry of Economy, Trade and Industry said in Wednesday's preliminary reading that industrial production in Japan jumped a seasonally adjusted 2.7 percent on month in December. That beat expectations for an increase of 1.5 percent following the 0.5 percent gain in November.
Japan will also see December numbers for housing starts and January results for its consumer confidence index today.
In the currency market, the U.S. dollar is trading in the upper 108 yen-range on Wednesday.
On Wall Street, stocks extended losses on Tuesday on continued profit taking, with traders cashing in on the recent strength of the markets. Traders were also looking ahead to the Federal Reserve's monetary policy announcement later on Tuesday and employment data on Friday.
The Dow plunged 362.59 points or 1.4 percent to 26,076.89, the Nasdaq slid 64.02 points or 0.9 percent to 7,402.48 and the S&P 500 slumped 31.10 points or 1.1 percent to 2,822.43.
The major European markets also moved lower on Tuesday. While the U.K.'s FTSE 100 Index tumbled by 1.1 percent, the German DAX Index and the French CAC 40 Index dropped by 1 percent and 0.9 percent, respectively.
Crude oil futures extended losses on Tuesday amid expectations that U.S. oil production will remain robust throughout the year. WTI crude fell $1.06 or 1.5 percent to $64.50 a barrel on the New York Mercantile Exchange, falling further from a recent four-year peak above $66.