Japan's Nikkei falls as chip-related shares decline on caution ahead of Nvidia earnings

On the other hand, fibre optic cable makers rose, with Fujikura 5803.T and Furukawa Electric 5801.T up 4.15% and 6%, respectively.

Of more than 1,500 stocks trading on the TSE's prime market, 53% rose, 43% fell and 3% traded flat.

The shipping sector .ISHIP.T rose 2.91% to become the top performer among the Tokyo Stock Exchange's (TSE) 33 industry sub-indexes.

The S&P 500 and Nasdaq ended lower on Monday, pulled down by technology stocks, as investors weighed fresh U.S. economic sanctions against Iran and braced for a week that also includes a closely watched inflation report.

Quarterly results from chipmaker Nvidia NVDA.O are expected to be a key catalyst for markets. Any sign of slowing growth could reignite concerns over stretched valuations.

Shares of Nvidia fell for the seventh straight session.

In Japan, chip-testing equipment maker Advantest 6857.T fell 3.33% and chip-making equipment maker Tokyo Electron 8035.T fell 1.03%.

Memory chipmaker Kioxia 285A.T fell 1.37%.

Declines in shares of Samsung Electronics 005930.KS also weighed on Japanese chip-related shares, Yasuda said.

Samsung Electronics traded 3.5% lower on Tuesday, after falling 8.70% in the previous session as the chipmaker's record $79 billion shareholder-return plan disappointed investors.

Japan's Nikkei share average fell on Tuesday, as chip-related stocks tracked declines in their U.S. peers on caution ahead of Nvidia's earnings.