Tokyo's benchmark Nikkei index plunged nearly 2% today, its first trading day of 2020, in line with the risk aversion across global markets after the US killing of a top Iranian general.

The Nikkei 225 index - which gained more than 18% in 2019 - lost 1.91%, or 452 points, to close at 23,205, while the broader Topix index was down 1.4%, or 24 points, at 1,697. 

The US killed Iranian military mastermind Qasem Soleimani in a strike in Baghdad last week, boosting oil prices as it fanned fresh fears of conflict in the Middle East.

"Geopolitical tensions look like remaining elevated in coming days, lending support to oil prices and keeping risk asset markets on the defensive," National Australia Bank strategist Ray Attrill said in a note.

The yen soared as the Japanese currency drew safe-haven buying, a negative development for Japanese exporters.

But analysts said the impact of the geopolitical tensions on the market may be limited, as the market's real focus is still on the US-China trade war and the US presidential election this year. 

In individual stocks trade in Tokyo, Nissan lost 1.66% as former chief Carlos Ghosn fled Japan before his trial on charges of financial misconduct. 

Other automakers also fell on a strong yen, with Toyota down 1.93%. 

Nintendo dropped 2.8% while major shipping company Nippon Yusen tumbled 2.9%. Petroleum explorer Inpex surged 4% on higher oil prices.