- POSTED: 06 Jan 2014 11:00
- UPDATED: 06 Jan 2014 15:31
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Tokyo shares slumped 2.35 per cent on Monday on their first trading day of the year, hit by a weaker dollar and profit-taking, after posting the its best annual advance in four decades.
TOKYO: Tokyo shares slumped 2.35 per cent on Monday on their first trading day of the year, hit by a weaker dollar and profit-taking, after posting the its best annual advance in four decades.
The benchmark Nikkei-225 index fell 382.43 points to 15,908.88, while the Topix index of all first-section shares fell 0.78 per cent, or 10.14 points, to 1,292.15.
The market resumed normal trading after a 57 per cent gain in 2013 -- its best since 1972 -- fuelled by Tokyo's big-spending and easy-money policies, which helped push down the yen and in turn gave a boost to exporters.
Investors retreated on Monday as the dollar slipped to 104.33 yen from 104.85 yen in New York Friday, and well off the 105.41 yen it hit at the start of last week, which was a five-year high.
"Tokyo stocks are overbought, and a break in the yen's fall, plus weaker futures are sure to result in some long-needed profit-taking after the December run-up," Hiroichi Nishi, general manager of equities at SMBC Nikko Securities, told Dow Jones Newswires.
"Hopes for a continued US economic recovery and longer-term dollar appreciation should keep sharp sell-offs well contained, however," he added.
Market heavyweight Fast Retailing, operator of the Uniqlo clothing chain, tumbled 5.76 per cent to 40,900 yen, after nearly doubling over the past year.
Sony was down 1.31 per cent at 1,802 yen, Canon fell 0.90 per cent to 3,300 yen and Toyota was 1.86 per cent lower at 6,300 yen.