Japan's Nikkei reverses course to end lower as Fast Retailing tanks

Japan's Nikkei share average surrendered early gains to close lower on Friday as sharp declines in Fast Retailing led technology stocks to erase their gains.

The Nikkei slipped 0.19% to 39,569.68 after rising as much as 0.8% earlier in the session. The index fell 0.6% this week. The broader Topix TOPIX rose 0.39% to 2,823.24.

Fast Retailing 9983 tanked 6.93% after the Uniqlo brand owner said on Thursday higher U.S. tariffs would start impacting its U.S. operations significantly from later this year and that it plans to raise prices to mitigate the blow.

"Investors were worried about Fast Retailing's outlook for the next fiscal year. Still, gains of technology stocks supported the index," said Kentaro Hayashi, senior strategist at Daiwa Securities.

The market also sold stocks as soon as the Nikkei approached the psychologically important level of 40,000, strategists said.

Chip-related Advantest 6857 and Tokyo Electron 8035 rose 0.71% and 0.9%, respectively, to track a 0.75% gain in the Philadelphia SE Semiconductor Index SOX overnight.

Air-conditioning maker Daikin Industries 6367 climbed 5.44%.

Banks advanced, aiding gains in the Topix, with Mitsubishi UFJ Financial Group 8306 and Sumitomo Mitsui Financial Group 8316 rising 1.77% and 1.53%, respectively.

Toyota Motor 7203 added 1.39%.

Seven & I Holdings 3382 rose 3.28% after the convenience store operator posted a 9.7% jump in quarterly operating profit, beating analysts' estimate.

Of more than the 1,600 stocks trading on the Tokyo Stock Exchange's prime market, 70% rose, 25% fell and 3% traded flat.