Japan : Nikkei falls to more than 1-week low on strong yen

TOKYO : Japan’s Nikkei share average dropped to its lowest in more than a week on Thursday morning as the strong yen dragged down exporter shares and soured sentiment in the broader market.The Nikkei dropped 0.5 percent to 16,665.00 in mid-morning trade after falling to as low as 16,560.20 earlier, the lowest since August 8.

Exporters lost ground after the yen firmed 0.4 percent to 99.87 yen per dollar, coming within sight of its seven-week peak of 99.55 to the dollar set on Tuesday.

Nissan Motor Co shed 1.4 percent and Toyota Motor Corp dropped 0.6 percent.

“A risk for an even stronger yen remains in the market and investors are being sensitive,” said global market strategist at JPMorgan Asset Management.

He added that expectations for the Bank of Japan’s exchange traded funds (ETF) buying may help limit the drop in the market, but new buying by investors should be subdued for a while.

The central bank said late last month that it would increase ETF purchases so its total holdings increase at an annual pace of 6 trillion yen, up from its previous pace of 3.3 trillion yen.

On the other hand, individual companies releasing bright outlook attracted buying. Discount store operator Don Quijote Holdings rose 3 percent after saying that it expects a 4.2 percent rise in its full-year operating profit to 45 billion yen for the year ended June.

The broader Topix dropped 0.5 percent to 1,304.14 and the JPX-Nikkei Index 400 declined 0.6 percent to 11,735.89.