The benchmark Nikkei 225 Index is down 105.53 points or 0.38 percent at 27,780.34, after hitting a low of 27,646.78 earlier. Japanese stocks closed modestly higher on Tuesday.
Market heavyweight SoftBank Group is edging up 0.1 percent and Uniqlo operator Fast Retailing is losing almost 2 percent. Among automakers, Honda is edging up 0.5 percent and Toyota is adding almost 1 percent.
In the tech space, Tokyo Electron is losing almost 3 percent, Screen Holdings is down 1.5 percent and Advantest is declining almost 2 percent.
In the banking sector, Sumitomo Mitsui Financial is gaining 1.5 percent, Mizuho Financial is adding more than 1 percent and Mitsubishi UFJ Financial is up almost 1 percent.
Among the major exporters, Sony and Mitsubishi Electric are losing almost 1 percent each, while Canon is edging down 0.1 percent and Panasonic is edging down 0.4 percent.
Among the other major losers, CyberAgent is losing almost 3 percent.
Conversely, Fujikura and Taisei are gaining almost 4 percent each, while Kansai Electric Power is adding more than 3 percent. Fukuoka Financial Group and Isetan Mitsukoshi are up almost 3 percent.
On Wall Street, stocks moved sharply lower during trading on Tuesday, extending the sell-off seen over the course of Monday's session. The major averages all showed significant moves to the downside, with the tech-heavy Nasdaq posting a particularly steep loss.In the currency market, the U.S. dollar is trading in the lower 137 yen-range on Wednesday.
The major averages climbed off their worst levels going into the close but remained firmly negative. The Dow slumped 350.76 points or 1.0 percent to 33,596.34, the Nasdaq plunged 225.05 points or 2.0 percent to 11,014.89 and the S&P 500 tumbled 57.58 points or 1.4 percent to 3,941.26.
The major European markets also moved to the downside on the day. While the French CAC 40 Index edged down by 0.1 percent, the U.K.'s FTSE 100 Index and the German DAX Index slid by 0.6 percent and 0.7 percent, respectively.
Crude oil prices dropped to an 11-month low on Tuesday amid concerns about the outlook for energy demand as uncertainty and consequences of a continued Fed tightening weighed on the commodity. West Texas Intermediate Crude oil futures for January ended lower by $2.68 or 3.5 percent at $74.25 a barrel.