Tokyo stocks tumbled Monday morning, with selling of technology and exporter-related issues spurred by plunges in U.S. semiconductor-related shares late last week and a stronger yen against the U.S. dollar.
The 225-issue Nikkei Stock Average fell 984.84 points, or 2.48 percent, from Friday to 38,704.10. The broader Topix index was down 61.43 points, or 2.25 percent, at 2,665.37.
The dollar briefly weakened to the mid-146 yen range on yen buying amid speculation that the Bank of Japan could move to end its negative interest rate policy in March.
At noon, the dollar fetched 147.06-09 yen compared with 147.04-14 yen in New York and 147.87-89 yen in Tokyo at 5 p.m. Friday.
The euro was quoted at $1.0939-0940 and 160.84-93 yen against $1.0935-0945 and 160.79-89 yen in New York and $1.0933-0934 and 161.67-71 yen in Tokyo late Friday afternoon.
Stocks plunged as investors locked in gains after the benchmark Nikkei recently hit all-time highs, briefly surpassing the 40,000 line. The index fell to its lowest intraday level since Feb. 22, when it topped record highs marked in 1989.
Semiconductor-related issues tracked sharp declines in their U.S. counterparts Friday, while the yen's strengthening trend also fueled selling of exporters such as Toyota Motor, which benefit from a weaker yen when overseas profits are repatriated.
"Today's fall is currently within the bounds of a healthy adjustment after the Nikkei stayed close to 40,000 in recent days," said Toshikazu Horiuchi, equity strategist at IwaiCosmo Securities Co.
"In the case of semiconductors, they are seen to have risen too quickly, rather than being overbought. Expectations of growth from generative artificial intelligence aren't going away, so we can expect buying to return once this adjustment ends," he added.
