Stocks lost further ground on the Tokyo Stock Exchange on Friday, weighed down by selling on concerns over the yen’s continued firmness against the dollar.
The 225-issue Nikkei average shed 37.61 points, or 0.16 percent, to close at 23,631.88. On Thursday, the key market gauge lost 271.29 points.
The Topix index of all first-section issues ended down 5.17 points, or 0.27 percent, at 1,879.39, after falling 16.67 points the previous day.
The Tokyo market had got off to a firmer start, helped by the yen’s easing compared with Thursday, traced to U.S. President Donald Trump’s comment that he wants the dollar to be strong, and by an overnight rise in U.S. equities, brokers said.
But stocks, particularly large-cap issues, met with a wave of selling later after the yen strengthened again in Tokyo trading, brokers said.
The afternoon slack can be attributed to speculative selling by investors disappointed that the Bank of Japan would not carry out purchases of exchange-traded funds, as the Topix ended higher in the morning session, said Mitsuo Shimizu, equity strategist at Japan Asia Securities Co.
After the halt to the “extreme” strength of the yen and Wall Street’s advance on Thursday, the Tokyo market temporarily gathered steam, but foreign investors moved for selling from around noon, said Yutaka Miura, senior technical analyst at Mizuho Securities Co.
Behind the selling was a sense of caution among investors that “the U.S. government, in reality, may be hoping for a weaker dollar,” Miura said, citing U.S. Treasury Secretary Steven Mnuchin’s remark Wednesday that signaled such suspected hidden intentions in Washington.
Under current dollar-yen exchange rates, it may be difficult for the Nikkei to maintain its rising trend, as corporate earnings will likely be eroded, Shimizu said.
Rising issues outnumbered falling ones 1,079 to 876 in the TSE’s first section, while 109 issues were unchanged.
Volume edged down to 1.53 billion shares from 1.56 billion shares on Thursday.
Oil firms JXTG, Idemitsu, Inpex and Japex were downbeat due to selling to lock in profits.
Mitsubishi Motors was met with selling after informing the transport ministry on Thursday that it will recall some 170,000 units of five vehicle models.
Electronics maker Fujitsu General tumbled 10.28 percent after revising down its earnings forecast for fiscal 2017, which ends in March.
By contrast, Rakuten attracted purchases after the cybermall operator announced Friday that it has formed a strategic partnership with Walmart.
Internet Initiative Japan was buoyant a day after the mobile virtual network operator announced that it has set up a new company to offer payment services using virtual currencies.
Fujitsu, the parent company of Fujitsu General, was upbeat on a media report on Friday that it will sell its mobile phone business to an investment fund.