Tokyo stocks fell on Monday morning as the yen jumped in response to North Korea firing four ballistic missiles, three of which landed in Japanese-controlled waters.
Japanese Prime Minister Shinzo Abe said the missiles were launched “almost simultaneously” and warned the threat from Pyongyang had “entered a new stage”.
“Investors seem to be reacting to the North Korean missile launch,” said Hiroaki Hiwada, a strategist at Toyo Securities.
“The yen’s strengthening and investors are staying away from trades as geopolitical risk increases. I do think this is a temporary situation as we’ve seen in the past, but with these many missiles being launched there’s heightened tension,” he told Bloomberg News, reports BSS.
The benchmark Nikkei 225 index fell 0.52 percent, or 100.67 points, to 19,368.50 in early trading, while the Topix index of all first-section issues was down 0.35 percent, or 5.40 points, to sit at 1,552.65.
In Asian forex markets, the dollar slipped to 113.76 yen on Monday from 114.05 yen in New York on Friday afternoon.
A rise in the yen, which investors often buy as a safe investment during times of uncertainty and turmoil, is bad for the profitability of Japan’s exporters and hits demand for their shares.
Toyota shares fell 0.46 percent to 6,425 yen while Sony lost 0.63 percent to trade at 3,579 yen. Banks were also lower, with Mitsubishi UFJ Financial dropping 0.47 percent to 754.9 yen. Nintendo rose 2.80 percent to 24,375 yen after its launch of a new console last week.
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