The Nikkei share average edged up 0.06% to close at 27,742.29, after swinging up 0.37% and down 0.14%. The broader Topix edged down 0.02% to 1,935.35.
“The Nikkei gained earlier because the US market was strong overnight, but there was no market-moving catalyst that could lift the market further,” said Takatoshi Itoshima, a strategist at Pictet Asset Management.
“Investors are also cautious as they await the outcome of the Jackson Hole symposium. Also, they are eyeing the upcoming election of Japan’s ruling party.”
The three major US stock indexes ended modestly higher overnight, with the S&P 500 and the Nasdaq posting record closing highs.
In Japan, airlines gained 2.49%, the most among the Tokyo Stock Exchange‘s 33 industry sub-indexes, with Japan Airlines and ANA Holdings rising 2.9% and 2.18%, respectively.
Railways rose 1.25%, with Central Japan Railway , which runs bullet trains between Tokyo and Osaka, gaining 1.3%. Tokyo-based East Japan Railway climbed 1.81%.
But their gains were overshadowed by pandemic and political uncertainties. Japan will likely have a general election in October or later if the ruling party holds its leadership race next month as expected, the Sankei newspaper said.
Robot maker Fanuc dragged down the Nikkei the most, falling 1.61%, while staffing agency Recruit Holdings lost 1.28% and Sony Group dropped 1.48%.
Toshiba rose 1.72% after a report that Western Digital was in advanced talks for a potential $20 billion stock merger with Japanese semiconductor firm Kioxia Holdings Corp, of which Toshiba owns 40.5%.