Japan's Nikkei retreated to a 20-month low on Tuesday after a slide on Wall Street deepened with a series of unnerving U.S. political developments.

The Nikkei share average ended the day down 5.01 percent at 19,155.74 after brushing 19,117.96, its lowest since late April 2017. The day's performance put the index well into bear market territory — off more than 20 percent since its October high.

Japan's broader Topix closed 4.88 percent lower at 1,415.55 after touching 1,412.90, its weakest since November 2016.

In China, the Shanghai Index, which had fallen more than 2 percent by mid-day, recorded a slump of less than 1 percent. So far this year, the Shanghai stock index is down about 24 percent.

Those Asia moves followed Wall Street stocks extending their steep sell-off on Monday, with the S&P 500 down nearly 15 percent so far this month, as investors were rattled by the U.S. Treasury secretary's convening of a crisis group and by other political developments.

Many financial markets in Asia, Europe and North America are closed on Tuesday for Christmas Day.

"Negative sentiment has replaced logic, as is often the case during a sell-off. A third of the selling is induced by panic, another third by loss-cutting and the remaining third by speculators trying to make a profit from the market rout," said Takashi Hiroki, chief strategist at Monex Securities in Tokyo.

"The sell-off is triggered almost entirely by developments in the U.S. markets, rather than by negative factors unique to the domestic market."

Treasury Secretary Steven Mnuchin called top U.S. bankers on Sunday amid the pullback in stocks and said he was calling a meeting of financial regulators to discuss ways to ensure "normal market operations."

Wall Street also grappled with the U.S. federal government shutdown and reports that President Donald Trump privately discussed the possibility of firing the Federal Reserve chairman.

Japan's blue chip shares fell across the board, with Toyota Motor Corp falling 5.25 percent, Sony Corp shedding 5.55 percent, Nintendo down 4.3 percent and Mitsubishi UFJ Financial Group losing 4 percent.

Defensive shares such as consumer staples, healthcare and utilities were unable to withstand the selling pressure.

Convenience store operator Familymart UNY Holdings dropped 4.1 percent, healthcare product maker Kao Cor declined 4.6 percent and Tokyo Electric Power Co Holdings retreated 3.4 percent.

All of the Tokyo Stock Exchange's 33 subsectors were in the red, led by precision machinery and pharmaceuticals

—CNBC's Everett Rosenfeld contributed to this report.