Dollar above 123 yen line for 1st time in 6 yrs, Tokyo stocks fall
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- 28 Mar 2022
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The U.S. dollar briefly topped the 123 yen line Monday for the first time since December 2015, while Tokyo stocks fell in the morning on concerns over the Chinese economy after Shanghai came under a lockdown due to rising COVID-19 infections.
The 225-issue Nikkei Stock Average dropped 162.64 points, or 0.58 percent, from Friday to 27,987.20. The broader Topix index of all First Section issues on the Tokyo Stock Exchange was down 6.74 points, or 0.34 percent, at 1,974.73.
The U.S. dollar shot up from the lower 122 yen range as the unit was sought on expectations of a widening interest rate gap between the United States and Japan, dealers said.
The currency's advance followed an announcement by the Bank of Japan that it will offer to buy an unlimited amount of government bonds at a fixed rate to stem a further rise in long-term interest rates.
At noon, the dollar fetched 122.90-91 yen compared with 122.05-15 yen in New York and 121.73-75 yen in Tokyo at 5 p.m. Friday.
The euro was quoted at $1.0955-0956 and 134.64-66 yen against $1.0976-0986 and 134.14-24 yen in New York and $1.1022-1024 and 134.17-21 yen in Tokyo late Friday afternoon.
Tokyo stocks lost ground at the outset as investors secured profits on technology issues and other major gainers after the benchmark Nikkei index rose about 3,000 points over nine trading days through Friday.
The market was weighed down by worries over the outlook for the Chinese economy after its financial hub Shanghai came under a nine-day lockdown starting Monday, with each half of the city to be shut down in turns to conduct mass COVID-19 testing.
Masahiro Ichikawa, chief market strategist at Sumitomo Mitsui DS Asset Management Co., said investors feared the impact on the world's second-largest economy if the lockdown is extended or if other parts of China also implement similar measures.
But the market trimmed losses later in the morning as export-related shares advanced after the U.S. dollar rose sharply against the Japanese currency.
A weaker yen enables exporters to earn more when they repatriate overseas profits.
On the First Section, declining issues outnumbered advancers 1,290 to 774, while 116 ended the morning unchanged.
Decliners were led by nonferrous metal, marine transportation and iron and steel issues.
Nikkei heavyweight Fast Retailing, which operates the Uniqlo clothing chain, lost 1,450 yen, or 2.3 percent, to 61,620 yen, on concerns over the impact of the Shanghai lockdown on its sales. Read More...
