Tokyo stocks fell Thursday amid Wall Street's uncertain direction and rising global oil prices. The U.S. dollar dipped against the Japanese yen and the euro.
The Nikkei Stock Average of 225 selected issues fell 97.68 points, or 0.82 percent, to close at 11,775.50 points. The index gained 52.09 points, or 0.44 percent, Wednesday.
The dollar was trading at 104.17 yen at 5 p.m. (0800 GMT) Thursday, down 0.11 yen from late Wednesday in Tokyo and also below the 104.19 yen it bought in New York later that day. The dollar traded between 104.08 yen and 104.48 yen in Tokyo.
On the stock market, the Nikkei index lost ground amid concerns on the uncertain outlook for U.S. stocks and soaring global oil prices, although continued optimism about Japan's economic recovery helped limit the index's downside.
"Even without the New York market slump and oil price rise, Tokyo stocks needed adjustment after the recent rally," said Shigeharu Shiraishi, managing director at Societe Generale Asset Management (Japan) Co.
Stocks started lower after Wall Street tumbled overnight on higher oil prices. Crude prices jumped US$1.41 to close at US$56.46 a barrel in New York, a new high, after the U.S. Department of Energy released data showing domestic supplies of gasoline and heating oil fell sharply last week, raising concerns about higher inflation and interest rates.
Technology blue-chip issues led the Tokyo market's slide.
Chip-manufacturing equipment maker Tokyo Electron Ltd. shed 1.1 percent, Kyocera Corp. lost 1.2 percent and TDK Corp. fell 1.3 percent. Other losing blue chips included Sony Corp. and Advantest Corp. Telecom stocks KDDI Corp. and NTT DoCoMo Inc. also declined, as did automakers Honda Motor Co. and Toyota Motor Corp.
The broader TOPIX, which includes all issues on the Tokyo Stock Exchange's first section, lost 5.97 points, or 0.50 percent, to finish Thursday's trading at 1,192.28 points. The TOPIX rose 5.45 points, or 0.46 percent, the day before.
First-section volume rose to 1.633 billion shares, from Wednesday's 1.617 billion shares. Decliners beat advancers 964 to 571, while 113 issues were unchanged.
The Dow Jones industrial average finished down 112.03, or 1.04 percent, to 10,633.07. The Nasdaq composite index fell 19.23, or 0.94 percent, to 2,015.75.
In currencies, renewed worries over the deepening U.S. trade deficit, with growing speculation that the world's central banks are diversifying their foreign reserves away from the dollar and into other currencies, kept traders bearish toward the American currency.
"Nothing has changed as far as the dollar's broad downtrend is concerned," said Masamichi Koike, head of the foreign exchange spot trading group at Sumitomo Mitsui Banking Corp.
The dollar weakened overnight in New York after the U.S. Commerce Department reported that its current account deficit widened to a record US$187.9 billion during the fourth quarter of 2004 from an upwardly revised $165.9 billion in the third quarter.
The euro rose to US$1.3396 late Thursday afternoon in Tokyo from US$1.3362 late Wednesday and to 139.60 yen from 139.34 yen.