Tokyo stocks fell Thursday morning, as investor sentiment was dented after the U.S. Federal Reserve signaled overnight that cuts to interest rates were unlikely to begin soon.
The 225-issue Nikkei Stock Average dropped 262.42 points, or 0.72 percent, from Wednesday to 36,024.29. The broader Topix index was down 16.09 points, or 0.63 percent, at 2,535.01.
The U.S. dollar fell slightly to the mid-146 yen range as the Fed suggested there would be no further interest rate hikes after its policy meeting Wednesday.
At noon, the U.S. dollar fetched 146.58-59 yen compared with 146.87-97 yen in New York and 147.65-67 yen in Tokyo at 5 p.m. Wednesday.
The euro was quoted at $1.0817-0821 and 158.56-63 yen against $1.0813-0823 and 158.92-159.02 yen in New York, and $1.0815-0817 and 159.69-73 yen in Tokyo late Wednesday afternoon.
Tokyo stocks tracked falls on all three major Wall Street indexes overnight, after the Fed cautioned that rate cuts were not on the horizon until it was confident a downturn in inflation is sustainable.
"The Fed meeting outcome acted as a catalyst for moves to lock in gains at a time when upward momentum in Tokyo stocks was clearly slowing down" after they hit 34-year highs recently, said Chihiro Ota, assistant general manager of investment research at SMBC Nikko Securities Inc.
