Nikkei turns lower as yen's rise hits exporters

Wed Oct 23, 2013 12:42am EDT

* Yen's rise triggers profit-taking, futures selling
    * Exporters lead declines

    By Ayai Tomisawa
    TOKYO, Oct 23 (Reuters) - Japan's Nikkei share average
turned lower on Wednesday afternoon, as exporters were hit after
the dollar weakened against the yen on heightened expectations
the Federal Reserve will keep its stimulus in place until early
next year.
    The Nikkei dropped 1.2 percent to 14,530.24 in early
afternoon trade, retreating from a 3-1/2 week high of 14,799.28
hit in the morning.
    Traders said that futures selling was triggered by weakness
in the dollar, which slipped 0.5 percent to 97.47 yen.
The dollar's weakness was triggered by a soft U.S. jobs report
on Tuesday, which cemented the view the Fed will delay winding
back its bond-buying stimulus until next year.  
    "Futures moved in reaction" to the rise in the yen, said a
trader at a foreign brokerage, adding that selling accelerated
when the index breached below a stop-loss level at 14,580.
    Exporters dropped, with Honda Motor Co falling 2.4
percent, Sony Corp off 1.7 percent and Panasonic Corp
 shedding 1.7 percent.
    A stronger yen erodes Japanese exporters' competitiveness
overseas.
    Against the yen, the euro also slipped 0.4 percent to 134.72
yen.
    "It's the yen rising against both the dollar and the euro,"
said Shigemitsu Tsuruta, a senior strategist at SMBC Friend
Securities. "There were signs that the Japanese market was
overbought, so investors used the yen's rise as a reason to take
profits."
    The Topix shed 0.8 percent to 1,204.42.
A couple walks along the rough surf during sunset at Oahu's North Shore, December 26, 2013. REUTERS/Kevin Lamarque

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