Nikkei 225 falls for the third day in a row on Friday as concerns about a third wave of coronavirus infections have heavily affected market sentiment.
The Nikkei average fell 106.97 points, or 0.42%, to 25,527.37 points after falling 93.80 points on Thursday.
The thematic index of all issues of the first section of the Tokyo Stock Exchange closed almost unchanged, rising 0.98 points, or 0.06%, to 1,727.39 points, after rising 5.76 points the day before.
Asian stocks are falling amid reports of record numbers of coronavirus cases in several prefectures in Japan and the third wave of the pandemic in South Korea.
The third wave of coronavirus infections is being observed in Seoul and surrounding communities, the South Korean Ministry of Health said.
Brokers said the recent surge in infections in Japan "will make company stocks sensitive to news of the coronavirus," such as policies that prefectural governors will adopt to combat the epidemic.
Despite concerns, many investors believe that governments will not implement measures on the scale of those taken in the spring, which will leave the global economy relatively stable, said Hirohumi Yamamoto, strategist at Toyo Securities Co.
Yamamoto added that market participants are also optimistic about the long-term economic outlook following the introduction of the coronavirus vaccine and therefore are not participating in the sales.
The largest drop in the index is shown by transport companies and insurers. The quotes of pharmaceutical companies are also falling.
Shares of steel companies, on the contrary, are significantly more expensive. JFE rose 2.01%, while Nippon Steel rose 2.87%.
Other winners include Technology Investor SoftBank Group, which rose 2.62%.