Japanese equities dipped on Tuesday as the market ran out of puff after rallying to a 17-month high the previous day, though it was supported well by a confluence of factors like the significantly weaker yen.

The Nikkei share average edged down 0.1 per cent to 19,875.89. The index remained in reach of 19,929.48, its highest level since December 2015 reached on Monday when Emmanuel Macron was elected president of France, improving investor risk sentiment.

In addition to support from an ebb in geopolitical concerns, the Nikkei was seen to be well placed to eventually top the 20,000 threshold thanks to both fundamental and microeconomic factors. “The dollar is firmly above 113 yen now, providing a significant tailwind to equities,” said Masahiro Ichikawa, senior strategist at Sumitomo Mitsui Asset Management.

“The environment surrounding the broader equity market is also improving. Many corporations had previously set their dollar/yen exchange rate assumptions around 105-110 yen, and we can now expect many of them to revise up their earnings forecasts as the yen as depreciated.”

Sony Corp shares gained as much as 2.2 per cent to reach their highest level since September 2008. Already on a bullish footing after last week's upbeat earnings report, the electronics maker added to gains after a report that it was relaunching organic light-emitting diode (OLED) TVs.

Showa Shell added 2.6 per cent and Idemitsu Kosan advanced 1.2 per cent after the refiners announced they will hold a news conference later on Tuesday regarding their joint business. Opposition from Idemitsu's founding family had delayed a merger between the two rivals initially planned for April 2017.

Shares of Don Quijote Holdings Co gained as much as 4.9 per cent after the discount store operator revised up its net profit forecast to 31.5 billion yen ($278.22 million) for the year through June 2017 from 27.5 billion yen. The company expects to book a special profit from fixed asset sales.

Insecticide maker Earth Chemical slumped more than 6 percent after the company announced that its net profit for the first quarter fell 4.2 per cent to 2.04 billion yen, with expenses offsetting brisk product sales.

The broader Topix shed 0.2 per cent to 1,582.82 and the JPX-Nikkei Index 400 fell 0.25 per cent to 14,132.85.

Of Tokyo's 33 sub-indexes, 20 were in the red. ($1 = 113.2200 yen)