Stocks turned lower on the Tokyo Stock Exchange on Wednesday, pressured by the yen’s rise against the dollar.
The 225-issue Nikkei average fell 165.04 points, or 0.77 percent, to end at 21,252.72, after surging 375.67 points on Tuesday.
The Topix index of all first-section issues closed down 12.34 points, or 0.72 percent, at 1,703.96. It gained 21.51 points the previous day.
The Tokyo market opened weaker, with investor sentiment battered by the yen’s strengthening against the dollar, brokers said.
The yen attracted buying due to growing concerns over the course of U.S. President Donald Trump’s trade policy following the resignation of top economic adviser Gary Cohn, they said.
The Nikkei briefly lost over 210 points in early trading, but purchases on declines sent the key market yardstick to positive territory later in the morning.
After fluctuating around Tuesday’s closing levels, the Nikkei and Topix sank back into negative territory in the afternoon as the yen remained firm, brokers said.
Stocks met with selling as the resignation of Cohn, who took an anti-protectionist stance, “boosted worries that (planned) U.S. tariffs on steel and aluminum imports will be activated with (negative) implications for the global economy,” an official of a bank-linked securities firm said.
The official also noted that sell-offs in other Asian markets, prompted by Cohn’s exit from the Trump administration, dampened investor sentiment.
The Tokyo market’s downside was limited, however, because the Trump-led import tariff plan “has yet to be materialized,” an official of an asset management firm said, suggesting that some investors sat on the fence to wait to see whether the controversial tariffs will actually be introduced.
Buying on dips by individual and institutional investors underpinned the market’s downside, said Ryuta Otsuka, strategist at the investment information department of Toyo Securities Co.
Falling issues outnumbered rising ones 1,368 to 617 in the TSE’s first section, while 85 issues were unchanged.
Volume grew to 1.47 billion shares from Tuesday’s 1.29 billion shares.
Defense-related Ishikawa Seisakusho went limit-down as geopolitical tensions over the Korean Peninsula eased to some extent following news on Tuesday that North and South Korea have agreed to hold a summit in late April. Its peer Howa Machinery also tumbled.
The stronger yen battered such export-oriented issues as automakers Toyota, Honda and Subaru, electronics giant Panasonic and technology firms Kyocera, TDK and Murata Manufacturing.
Also on the minus side were industrial materials maker Showa Denko and clothing retailer Fast Retailing.
By contrast, precision equipment producer V-Technology scored a listing-to-date high, with a stock split taken into account, after announcing Tuesday that it has received orders worth a total of about ¥17 billion from multiple major overseas display manufacturers.
In index futures trading on the Osaka Exchange, the key March contract on the Nikkei average dropped 250 points to 21,200.