Tokyo stocks fall as exporters sold on stronger yen

TOKYO (Kyodo) — Tokyo stocks fell Monday, with auto and other exporter issues sold as a stronger yen against the U.S. dollar fueled concern over the adverse impact on overseas profits.

The 225-issue Nikkei Stock Average ended down 200.24 points, or 0.60 percent, from Friday at 33,231.27. The broader Topix index finished 19.87 points, or 0.83 percent, lower at 2,362.65.

On the top-tier Prime Market, decliners were led by transportation equipment, mining and bank issues.

The dollar briefly weakened to roughly a three-month low of 146.24 yen in Tokyo, as market players interpreted comments by Federal Reserve Chair Jerome Powell on Friday as a sign the U.S. central bank is done raising interest rates, dealers said.

At 5 p.m., the dollar fetched 146.95-97 yen compared with 146.75-85 yen in New York and 148.28-30 yen in Tokyo at 5 p.m. Friday.

The euro was quoted at $1.0853-0855 and 159.49-53 yen against $1.0879-0889 and 159.69-79 yen in New York, and $1.0894-0896 and 161.54-58 yen in Tokyo late Friday afternoon.

The yield on the benchmark 10-year Japanese government bond finished at 0.690 percent, down 0.010 percentage point from Friday’s close.

The debt was bought in Japan after a fall in U.S. long-term Treasury yields, which dropped on expectations that the Fed is done raising rates. Bond yields move inversely to prices.

Stocks fell as the yen’s swift strengthening against the dollar, which at one point climbed close to the 152 yen line last month, raised the prospect among investors that the currency’s depreciation may be turning around, at least in the short term, squeezing profits exporters earn overseas, analysts said.

“It’s easy for exporters to be sold when the yen strengthens because its weakness had boosted many companies’ results in the recent midterm earnings season,” said Masahiro Ichikawa, chief market strategist at Sumitomo Mitsui DS Asset Management Co.

But the Nikkei’s losses were limited, with investors buying on the dip as the benchmark traded at its lowest level in about three weeks on an intraday basis.

Automakers were mostly lower, with Toyota Motor down 65.5 yen, or 2.3 percent, at 2,767.5 yen and Mazda Motor slipping 58.0 yen, or 3.6 percent, to 1,543.5 yen.

Among major banking groups, Mitsubishi UFJ Financial Group dropped 29.0 yen, or 2.3 percent, to 1,244.0 yen, while Mizuho Financial Group lost 59.0 yen, or 2.3 percent, to 2,466.0 yen, on concern that falling long-term Japanese interest rates could reduce their profits.