Tokyo stocks close lower

Tokyo stocks closed lower on Thursday as the yen grew stronger against the dollar weighing on exporter shares, after the US Federal Reserve signalled interest rate cuts next year, AFP reported.

The benchmark Nikkei 225 index lost 0.73 percent, or 240.10 points, to 32,686.25, while the broader Topix index ended down 1.43 percent, or 33.57 points, at 2,321.35.

Even though some high-tech shares were bought in early trade, “US long-term (bond) yields further declined in after-hours trading, prompting the yen’s appreciation (against the dollar)”, which weighed on Tokyo stocks, Iwai Cosmo Securities said.

Mega banks and automakers led the declines, he added.

A stronger yen against the dollar is generally seen as a negative factor to Japanese exporters as it deflates their repatriated profits and dampens price competitiveness in foreign markets.

The dollar fetched 141.40 yen in late Tokyo hours, down from 142.67 yen in early Asia time and from 142.89 yen in New York.

The dollar-yen was at 145.80 in late Tokyo hours on Wednesday.

The greenback tumbled after the US central bank, as expected, kept interest rates flat for its third straight meeting, while Fed projections suggested three rate cuts next year.

In Japan, four cabinet ministers who belong to a faction that was headed by the late prime minister Shinzo Abe tendered their resignations over political fund graft claims.

“Its impact on (the Bank of Japan’s) monetary easing policy, that had been promoted by the Abe faction, is in focus,” senior analyst Ryotaro Sawada of Tokai Tokyo Research Institute said.

Among major shares in Tokyo, Toyota dropped 3.82 percent to 2,571.5 yen, Panasonic dived 4.48 percent to 1,363.5 yen, and Sony Group slipped 1.07 percent to 12,960 yen.

Mizuho Financial Group dropped 3.68 percent to 2,420.5 yen, and Sumitomo Mitsui Financial Group sank 5.25 percent to 6,985 yen.