Tokyo stocks plunged Friday morning, with the Nikkei index sinking over 2 percent as the yen's strength against the U.S. dollar hurt export-related issues and tensions grew in the Middle East.
The 225-issue Nikkei Stock Average fell 960.90 points, or 2.42 percent, from Thursday to 38,812.24. The broader Topix index was down 49.53 points, or 1.81 percent, at 2,682.47.
The dollar briefly fell to the upper 150 yen zone in Tokyo after Bank of Japan Governor Kazuo Ueda indicated in an interview with the Asahi Shimbun published Friday that the central bank is likely to consider another interest rate hike between summer and autumn.
At noon, the dollar fetched 151.18-19 yen compared with 151.30-40 yen in New York and 151.68-70 yen in Tokyo at 5 p.m. Thursday.
The euro was quoted at $1.0823-0827 and 163.62-69 yen against $1.0832-0842 and 163.95-164.05 yen in New York and $1.0856-0858 and 164.67-71 yen in Tokyo late Thursday afternoon.
Stocks fell almost across the board, as the market tracked declines on Wall Street as investors fled to safe-haven assets to reduce exposure amid heightened geopolitical concern, analysts said.
Israel is preparing for potential retaliation following its suspected killing of Iranian generals in Damascus earlier this week, with Prime Minister Benjamin Netanyahu vowing to defend the country against possible attacks.
"Amid caution about overheating following the market's recent rally, investors sold stocks on a combination of negative trading cues," including the yen's strength, tensions in the Middle East and U.S. share declines, said Masahiro Yamaguchi, head of investment research at SMBC Trust Bank.
