Stocks retreated on the Tokyo Stock Exchange on Wednesday, dampened by profit-taking after the recent surge.

The Nikkei 225 average lost 85.82 points, or 0.49 percent, to end at 17,280.48. On Tuesday, the key market gauge surged 352.01 points.

The Topix index closed down 7.02 points, or 0.50 percent, at 1,390.61, after rising 25.22 points the previous day.

Despite the Dow Jones industrial average’s slight rise overnight, the Tokyo market came under selling pressure from the outset of Wednesday’s trading due chiefly to selling to lock in profits after the Nikkei jumped over 500 points in the previous two sessions, brokers said.

In the afternoon, the Nikkei extended losses to over 180 points briefly after the Bank of Japan decided to keep its monetary policy intact and lowered its projection for year-on-year growth of the nation’s core consumer price index for fiscal 2015 to 1 percent from 1.7 percent.

A wait-and-see mood dominated the market for the rest of the session prior to a press conference by BOJ Gov. Haruhiko Kuroda after the closing bell, brokers said.

The European Central Bank is expected to introduce quantitative easing at its closely watched policy-setting meeting on Thursday, but investors moved to cash in gains on expectations of selling after the ECB meeting as there will likely be no additional buying incentives, brokers said.

Still, stock prices resisted falling further as “investors could not sell aggressively prior to the ECB meeting and due to signs of a halt to crude oil price tumbles,” said Ayako Terada, vice president at Nomura Securities Co.’s Investment Research & Investor Services Department.

“A full-fledged rebound (of the Nikkei average) is unlikely until investors confirm earnings reports from major Japanese companies” next week, Terada said.

Falling issues outnumbered rising ones 1,312 to 466 in the TSE’s first section, while 83 issues were unchanged.

Volume increased to 2.19 billion shares from Tuesday’s 2.13 billion shares.

A halt in the yen’s drop battered export-oriented names, including automakers Toyota, Honda and Mazda as well as technology giants Hitachi and Panasonic.

Mobile game site operator Gree fell sharply after Goldman Sachs revised down its investment rating and stock price target on the company.

On the other hand, Sony jumped 5.48 percent following a newspaper report Wednesday that the company will reduce its workforce by some 1,500 in Japan by the end of fiscal 2014.

Other major winners included robot-maker Fanuc, drug-maker Takeda, Japan Tobacco and tire manufacturer Bridgestone.

In index futures trading on the Osaka Exchange, the key March contract on the Nikkei average slumped 180 points to end at 17,210.