TOKYO (AFX-ASIA) - The yen was sharply lower against the dollar in midafternoon trade, breaching the 124.50 support level, following a report by the Nihon Keizai Shimbun that Aoki Corp will apply for court protection under the special corporate rehabilitation law, dealers said. A spokeswoman for Aoki said the company will hold a news conference today at 5.30 pm, declining to comment any further. A dealer at a US bank said there is concern spreading in the forex market that more construction firms may follow Aoki's collapse. "There is renewed concern in the forex market over (the health of) Japan's financial sector," he said. However, he said a collapse of Aoki itself will not have any significant impact on Japanese banks financially. "I think banks have already prepared enough provision for that. I don't think Aoki's collapse itself will create financial concerns," the dealer said. Asahi Bank Ltd, one of Aoki's main lenders, said the bank does not expect any impact from Aoki's possible collapse on Asahi Bank's year to March 2002 earnings. "We have made a year to March 2002 earnings revision after considering every possibility. Therefore, we are not expecting any impact from the collapse," the bank said. "However, it is certain that there will be more talk about (the health of) Japan's financial system and concerns (about the impact on) the forex market after (confirmation of the report)," he added. The dealer said yen-selling against the dollar after the news will be short-term. The euro was rangebound ahead of the European Central Bank meeting, dealers said. Daiwa Bank dealer Susumu Tsuda said the euro rate against the dollar will likely benefit if the ECB decides to cut leading interest rates by 25 basis points. "The euro (has fallen so) much against the dollar. I expect that the euro will benefit from an ECB rate cut," he said. However, he said any rise in the euro will be short-term, as investors will quickly turn cautions ahead of the release of the November non-farm payroll data next week. He said the euro/dollar will likely move in the 0.8800-0.9000 range next week.