Japanese equities fell at the start of trading on Wednesday, pressured by renewed selling in technology stocks and heightened geopolitical unrest following a U.S. military action against Iran.
The Nikkei 225 dropped 464.3 points, or 0.7%, to settle at 64,952.38.
The U.S. launched new strikes on Iran after a U.S. Apache helicopter was shot down in the Strait of Hormuz, raising concerns on a potential peace deal.
Investors are also focused on the upcoming U.S. inflation report later in the day, while strong American jobs figures from last week have reinforced expectations that the U.S. Federal Reserve may need to hike interest rates.
At home, economists anticipate the Bank of Japan to increase interest rate at least twice this year, with the first potentially arriving as soon as next week.
A Bloomberg News survey found that 49 out of 51 economists expect the BOJ to raise its benchmark rate by a quarter point to 1% at the conclusion of its June 16 meeting, a level not seen since 1995.