Tokyo stocks fell Monday morning, as fears of global economic instability from an escalating conflict in the Middle East and declines on Wall Street late last week spurred selling of a wide range of issues.
The 225-issue Nikkei Stock Average fell 409.36 points, or 1.04 percent, from Friday to 39,114.19. The broader Topix index was down 13.95 points, or 0.51 percent, at 2,745.69.
The U.S. dollar notched a fresh 34-year high in the upper 153 yen zone in Tokyo amid receding expectations that the U.S. Federal Reserve would cut interest rates soon following last week's stronger-than-expected inflation data.
At noon, the dollar fetched 153.71-72 yen compared with 153.22-32 yen in New York and 153.24-25 yen in Tokyo at 5 p.m. Friday.
The euro was quoted at $1.0649-0653 and 163.69-76 yen against $1.0636-0646 and 163.05-15 yen in New York, and $1.0684-0685 and 163.73-77 yen in Tokyo late Friday afternoon.
Stocks were lower from the outset, with the Nikkei briefly tumbling over 700 points amid concerns over heightened geopolitical tensions in the Middle East following Iran's retaliatory missile and drone attack against Israel over the weekend, analysts said.
"It is unclear exactly what Israel will do next, so (investors) were keeping a close eye on the situation," said Kazuo Kamitani, a strategist in the Investment Content Department of Nomura Securities Co.
While sentiment was also weighed down by declines on Wall Street late last week, the market later trimmed losses after the yen weakened, raising the prospect of higher earnings for Japanese exporters when repatriating overseas profits.
