TOKYO, Oct 12 (Reuters) - Japanese shares fell on Tuesday after a three-session rally, tracking a weaker finish on Wall Street and as fears over higher U.S. interest rates drove a sell-off in big technology stocks.
The Nikkei share average .N225 dropped 0.81% to 28,268.11 by 0215 GMT, while the broader Topix .TOPX lost 0.65% to
1,983.59.
"Wall Street's lower finish has pushed Japanese shares down but I would say today's declines were rather a reaction to a strong rally in the past few sessions," said Hideyuki Suzuki, general manager at investment research for SBI Securities.
"Investors saw rising U.S. interest rates as risk factors because when rates are high, growth shares are sold. That means Japanese technology stocks also decline."
U.S. stocks closed lower on Monday as investors grew nervous ahead of the third-quarter earnings reporting season, while U.S. Treasury yields hit multi-month highs at the end of last week in the wake of a weaker-than-anticipated September employment report. U.S. bond markets were closed on Monday for a holiday.
In Japan, technology heavyweights dragged the Nikkei lower on Tuesday, with start-up investor SoftBank Group 9984.T falling 2.6%, robot maker Fanuc 6954.T losing 1.62% and medical equipment maker Terumo 4543.T slipping 1.65%.
Shares that rose recently on hopes of an economic reopening fell, with retailers .IRETL.T and airlines .IAIRL.T losing
1.61% and 1.62%, respectively.
Yaskawa Electric Corp 6506.T , which was among the first to report results every earnings season, extended losses despite an upward revision to its profit outlook on Friday, losing 3.06%.
Oil explorer Inpex 1605.T edged up 0.41% amid a spike in oil prices. O/R
Eneos Holdings 5020.T advanced 1.51% after Japan's biggest refiner made a $1.8 billion acquisition of solar power plant operator Japan Renewable Energy to expand its low-carbon business.
(Reporting by Junko Fujita; Editing by Subhranshu Sahu)
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