TOKYO, Nov 15 (Reuters) - Japan's Nikkei share average dropped to a two-week low on Wednesday morning, with most sectors in negative territory as investors took profit on a rally that pushed local stocks about 20 percent higher over the past two months.
The Nikkei shed 0.8 percent to 22,207.01 in midmorning trade, after hitting as low as 22,150.63, its weakest level since Nov. 1.
Traders said foreign investors have taken profits from the rally of the past two months, in which they bought a total of 5.4 trillion yen in Japanese cash stocks and futures, when the Nikkei surged around 20 percent.
Retail investors are seen selling Japanese stocks as well. Japanese mutual funds saw the biggest monthly net flow in October as retail investors poured into money reserve funds after locking in profits from rising domestic stocks and equity funds, the Investment Trusts Association said. Overall mutual funds, or investment trust funds, saw a net inflow of a record high of 13.17 trillion yen in October.
Declines were seen across the board on Wednesday, though the biggest losers included mining stocks, steelmakers and real estate firms as well as automakers.
Inpex Corp stumbled 3.8 percent, Nippon Steel & Sumitomo Metal Corp declined 2.2 percent, Mitsui Fudosan Co dived 3.1 percent, while Toyota Motor Corp and Honda Motor Co both fell 1.4 percent.
The broader Topix dropped 1.2 percent to 1,757.23, with 32 of its 33 subsectors in negative territory. (Reporting by Ayai Tomisawa; Editing by Sam Holmes)