TOKYO, May 24 (Reuters) - Japan's Nikkei ended down on Tuesday, dragged lower by declines in U.S. futures and Asian shares, while investors struggling to find fresh catalysts after the earnings season came to an end also weighed on sentiment.
The Nikkei share average erased early gains to close 0.94% lower at 26,748.14, falling from the 27,000 psychological level reclaimed a day earlier. The broader Topix fell 0.86% to 1,878.26.
"With little indicators in the market, the number of participants was limited, which made the market to waffle," said Chihiro Ohta, assistant general manager at SMBC Nikko Securities' investment research and investor services.
The volume of shares traded on the Tokyo Stock Exchange's main board was 1.17 billion, compared to the average of 1.27 billion in the past 30 days.
Investor sentiment was also weighed down by worries about China's economic outlook, persistently high inflation across the globe, aggressive attempts by the U.S. Federal Reserve to control rising pricing pressures, and increasing energy costs, said a strategist at a domestic brokerage.
The services sector led declines among the Tokyo Stock Exchange's 33 industry sub-indexes. Staffing agency Recruit Holdings led the losses on the sub-index with a 6.56% drop.
Medical sersvices platform M3 fell 3.36%.
Banking shares fell 0.11%, reversing early gains underpinned by an increase of current-year interest income outlook by JPMorgan Chase & Co, the largest U.S. lender.
Industry leader Mitsubishi UFJ Financial Group ended 0.69% higher.
Trading firms were also strong, with Itochu rising 0.77% and Mitsubishi Corp climbing 0.64%.
(Reporting by Junko Fujita; Editing by Subhranshu Sahu and Rashmi Aich)