Stocks in Tokyo plunged Monday, hurt by a strengthening of the yen against the dollar.
The Nikkei 225 gave up 300.89 points, or 1.33 percent, to end at 22,396.99. The key market gauge sagged 66.80 points Friday.
The Topix, which covers all first-section issues on the Tokyo Stock Exchange, closed 6.28 points, or 0.36 percent, lower at 1,738.70 after slumping 4.61 points Friday.
The yen’s appreciation was prompted Friday by U.S. President Donald Trump’s comments warning against a stronger dollar and a news report that the Bank of Japan is considering making its long-term government bond yield target more flexible and will tolerate some overshooting, brokers said.
Selling of index futures and persistent concerns over U.S.-China trade friction also weighed on the market, brokers said.
“The Nikkei’s plunge is not a true reflection of the Tokyo market,” an official said.
Over half of the Nikkei’s loss was accounted for by declines in clothing retailer Fast Retailing, telecommunications giant SoftBank Group and industrial robot producer Fanuc Corp., all heavily weighted components of the key price index, the official added.
“Active buying is likely to be held in check this week amid investor caution over protectionism, and ahead of the BOJ’s policy-setting meeting next week,” said Hiroaki Kuramochi, chief market analyst at Saxo Bank Securities.
Some major companies, including Fanuc and semiconductor-related Tokyo Electron, are slated to release their April-June earnings later this week.
Possible strong earnings from them may put investors in a buying mood, Kuramochi added.
Falling issues outnumbered rising ones 1,112 to 884 in the first section, while 106 issues were unchanged.
Volume increased to 1.399 billion shares from 1.262 billion Friday.
The firmer yen battered export-oriented issues. They included automakers Toyota Motor Corp. and Mitsubishi Corp., as well as technology firm Murata Manufacturing Co.
Tokyo Steel Manufacturing Co. dropped 6.29 percent after announcing disappointing earnings for April-June on Friday.
Other major losers included Tokai Carbon Co. and Daito Trust Construction Co.
By contrast, financial issues attracted purchases after the BOJ bond news report fueled investor expectations for higher interest rates. Major gainers included megabank groups Mitsubishi UFJ Financial Group Inc. and Sumitomo Mitsui Financial Group Inc., as well as insurer Dai-ichi Life Holdings Inc.
Also on the plus side were Japan Tobacco Inc. and drug-maker Takeda Pharmaceutical Co.