Tokyo: Stocks close lower as yen rebounds

[TOKYO] Tokyo stocks closed lower Wednesday (Mar 30) despite global rallies, driven down as the dollar slipped against the yen.

The benchmark Nikkei 225 index gave up 0.8 per cent, or 225.17 points, to close at 28,027.25, while the broader Topix index fell 1.21 per cent, or 24.06 points, to 1,967.60.

The dollar stood at 121.97 yen, compared with 122.77 on Tuesday in New York and sharply lower from 123.59 yen in Tokyo the same day.

"The yen has been edging up since the opening of trade this morning, as reports said export-reliant companies bought the yen and sold the dollar" to settle their payments, Mutsumi Kanamori, a strategist at Daiwa Securities, said in a commentary.

The dollar further slipped against the yen after reports said Prime Minister Fumio Kishida had a meeting with Bank of Japan governor Haruhiko Kuroda, prompting market speculation that the government could intervene in the foreign exchange market, analysts said.

The yen had been plunging in recent sessions on a widening gap in interest rates for both currencies as well as the dollar's status as a safe asset amid the Ukraine crisis.

Japanese authorities have said drastic fluctuations in exchange rates are undesirable, but have not said they will intervene directly.

The Nikkei index also faced technical pressure after closing with gains on Tuesday - the final day to lock in rights for dividend payouts.

Among Tokyo shares, energy developer Inpex fell 3.31 per cent to 1,460 yen, and Nippon Steel plunged 5.16 per cent to 2,159 yen.

Leading shipping firm Nippon Yusen dropped 8.55 per cent to 10,160 yen, and Toyota 1.88 per cent at 2,218.5 yen. AFP