Tokyo: Stocks open down 1.73%

[TOKYO] Tokyo stocks opened 1.73 per cent lower on Friday after the yen jumped against other currencies on risk aversion.

The Nikkei 225 index at the Tokyo Stock Exchange fell 295.74 points to 16,812.96 at the start.

Wall Street stocks on Thursday fell for a fifth straight day following disappointing US bank earnings and a surprise move by the Swiss central bank to strengthen its currency.

The Dow Jones Industrial Average fell 0.61 per cent while the broad-based S&P 500 dropped 0.92 per cent.

The dollar was at 116.13 yen early Friday, down from 116.25 yen in New York late Thursday and 117.70 yen in Tokyo earlier Thursday.

The yen soared as other currencies plunged against the Swiss franc. A strong yen is negative for Japanese exporters and drags down the Tokyo bourse.

The Swiss National Bank announced on Thursday it was abandoning the minimum rate of 1.20 francs against the euro, a ceiling it had imposed three years ago to hold down the value of the franc against the currency of the 19-nation eurozone, of which it is not a member.

Minutes after the announcement, the safe-haven Swiss franc strengthened almost 30 per cent against the euro.

The euro bought 0.9945 francs early Friday compared with 1.0035 late Thursday.

The European common currency also fetched US$1.1638 and 135.13 yen on Friday against US$1.1623 and 135.12 yen in US trade on Thursday.

AFP