Nikkei futures in Chicago ended at 9,100, down 0.9 percent compared to the close in Osaka and market players said the benchmark index was likely to trade between 9,000 to 9,150.
Greece's leftist candidate for prime minister, Alexis Tsipras, set a rejection of international bailouts for the country as a condition for a new coalition after Sunday's election, sparking fears Greece could leave the euro altogether and worsen Europe's fiscal health.
"The market as a whole will be in risk-aversion mode due to the problems in Greece," said Masayuki Doshida, a senior market analyst at Rakuten Securities.
"If bluechips go down then mid-caps and small-caps will quickly follow and buying will be restricted to shares of companies that have given good guidance recently."
More than 60 percent of the 83 Nikkei companies that have reported January-March earnings so far beat or met market expectations, data from Thomson Reuters StarMine showed, much better the previous quarter.
But the positive news has failed to ignite the Nikkei, which has been hurt by concerns that the U.S. recovery may be faltering as well as worries about slower growth in China and instability in the euro zone.
A strong yen and a plummet in shares of social gaming companies on regulatory concerns have also weighed on the market.
The Nikkei ended 0.7 percent higher on Tuesday at 9,181.65, making a modest recovery after it fell 2.8 percent on Monday, its biggest decline in six months after Greek and French elections.
> Wall St falls on Europe, but late buying trims losses (.N) > Euro slips for 7th day vs dollar; politics weigh (FRX/) > Greek political fears push prices up (US/) > Gold down 2 pct, breaks below $1,600 on euro fears (GOL/) > Oil slips as Europe, Greece fan demand worries (O/R)
STOCKS TO WATCH
- TOSHIBA CORP (6502.T)
Toshiba said after the bell on Tuesday it was likely to make an operating profit of 300 billion yen in the current financial year, an increase of almost 50 percent and above the mean estimate of 281.9 billion yen from a poll of 22 analysts by Thomson Reuters I/B/E/S. [ID:nL1E8G20CG]
- PANASONIC CORP (6752.T)
Panasonic could forecast a net profit of about 50 billion yen ($626.7 million) for the year ending March 2013 due to restructuring, according to the Nikkei business daily. The figure would be well above an estimated net loss of 780 billion yen for the year just ended.
- GREE INC (3632.T) AND DENA CO LTD (2432.T)
Gree Inc, Japan's leading social gaming site, said on Tuesday that it will strengthen policing of its content as regulators consider a clamp down on Internet games seen to be flouting gambling restrictions.
(Reporting by Sophie Knight; Editing by Edwina Gibbs)
