Japan's Nikkei share average dipped on Thursday after weak earning reports by companies such as Kobe Steel and in the wake of declines on Wall Street, but the losses were limited as banks performed strongly on the back of rising bond yields.

The Nikkei was down 0.24 per cent at 22,691.24, inching away from a near two-week high marked the previous day.

The S&P 500 and the Dow slipped on Wednesday as gains in Apple shares were offset by a drop in energy and industrial companies, with the latest flare-up in US-China trade tensions dampening broader sentiment.

Kobe Steel fell more than 8 per cent after it reported a 55 per cent drop in recurring profit in the April-June quarter as a data-tampering scandal that hit Japan's third largest steelmaker hurt profits. And Furukawa Electric Co slumped 11 per cent after the maker of metal products, cables and optical fibres saw its net profit fall 51.6 per cent to ¥3.31 billion in the April-June quarter.

But a rise in Japan's benchmark 10-year bond yield to a 1-1/2-year peak lifted financial shares, with higher interest rates seen as a boon for banks. Sumitomo Mitsui Financial Group rose 0.44 per cent, Mitsubishi UFJ Financial Group was up 0.8 per cent and Mizuho Financial Group gained 1.1 per cent.

The banking subsector has climbed roughly 2.6 per cent so far this week. Other gainers included Konica Minolta Inc , which rose 4.92 per cent after the printer and optical devices manufacturer revised up its operating profit forecast for the year through March 2019 to ¥62 billion ($555 million) from ¥60 billion.

Technology stocks advanced after the tech-heavy Nasdaq rose overnight. Tokyo Electron climbed 0.5 per cent, Advantest Corp gained 1.4 per cent and SUMCO Corp rose 0.37 per cent. The broader Topix was 0.02 per cent lower at 1,769.27.

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