TOKYO (Kyodo) -- Tokyo stocks dropped Wednesday, with semiconductor shares hit by concerns about their profit outlook after U.S. giant Nvidia Corp. projected hefty expenses due to U.S. export restrictions on China.

The 225-issue Nikkei Stock Average ended down 347.14 points, or 1.01 percent, from Tuesday at 33,920.40. The broader Topix index finished 15.32 points, or 0.61 percent, lower at 2,498.03.

On the top-tier Prime Market, decliners were led by marine transportation, nonferrous metal and bank issues.

The U.S. dollar fell to a seven-month low of 142.05 yen in Tokyo, as the yen was bought back amid mounting speculation that Washington will accuse Tokyo of deliberately weakening its currency, a claim it denies, in upcoming bilateral tariff talks.

At 5 p.m., the dollar fetched 142.10-11 yen compared with 143.22-32 yen in New York and 143.30-32 yen in Tokyo at 5 p.m. Tuesday.

The euro was quoted at $1.1387-1389 and 161.81-85 yen against $1.1275-1285 and 161.58-68 yen in New York and $1.1357-1358 and 162.75-79 yen in Tokyo late Tuesday afternoon.

The yield on the benchmark 10-year Japanese government bond ended at 1.290 percent, down 0.075 percentage point from Tuesday's close, as a slide in Japanese stocks fanned expectations that the Bank of Japan cannot raise interest rates in the near future.

Stocks rose slightly at the open, lifted by some domestic demand-sensitive issues, but soon lost momentum as heavyweight chip shares fell on news of Nvidia's $5.5 billion in charges stemming from U.S. government export curbs on its H20 artificial intelligence chip to China, brokers said.

Nikkei heavyweight Advantest, seen as a major Nvidia supplier, plunged 6.5 percent while selling spread to other chip-related shares such as Tokyo Electron.

The market's losses deepened later in the day as investors unloaded export-oriented machinery and electronics shares, with a stronger yen seen as eroding overseas profits when repatriated.

Investors also refrained from trading actively ahead of Japan-U.S. tariff negotiations that are set to start Wednesday in Washington, brokers said.

"The market situation is likely to change if (details) of Japan-U.S. talks come to light and the United States shows a more clear stance" on whether it would maintain its hardline stance on China, said Kazuo Kamitani, strategist at Nomura Securities Co.'s Investment Content Department.