Tokyo stocks fall 1.47% by break
Tokyo stocks sank 1.47 percent Wednesday morning, hit by a stronger yen and the International Monetary Fund's decision to cut its economic growth forecast for the country and the global economy.
The Nikkei 225 index at the Tokyo Stock Exchange fell 231.57 points to 15,552.26 by the break, while the Topix index of all first-section shares was down 1.48 percent, or 19.11 points, at 1,271.78.
European and US markets finished sharply lower Tuesday after the IMF trimmed its global growth forecast and warned of stagnation in advanced economies.
The news boosted the yen -- which benefits in times of turmoil or uncertainty -- and hurt shares of Japanese exporters.
"Most of the buying of Japan shares over the past several months has come on the back of the stronger dollar, so an unwinding of dollar-long positions is going to cause this kind of backlash since fundamental buyers have been so few," Daisuke Uno, strategist at Sumitomo Mitsui Banking, told Dow Jones Newswires.
The IMF forecast global growth this year of 3.3 percent, down 0.1 percentage points from July's estimate and 0.4 points off what it tipped in April.
Its 2015 outlook was cut to 3.8 percent growth from 4.0 percent previously forecast.
The Washington-based Fund also nearly halved its 2014 growth projections for Japan, underscoring the damage that an April consumption tax hike inflicted on the world's number three economy.
The new projection for 0.9 percent expansion in Japan this year is well down from the July projection of 1.6 percent.
Earlier Tuesday German data showed industrial production slumped 4.0 percent in August -- the second successive day of disappointing figures out of Europe's largest economy.
In Tokyo, Toyota shares tumbled 2.15 percent to 6,229.0 yen, Sony fell 0.88 percent to 1,896.0 yen, while Canon was off 0.77 percent at 3,476.0 yen.
Japan Tobacco was down 0.81 percent at 3,573.0 yen after it said it was mulling the closure of two European plants and reducing production at another, which could lead to about 1,100 layoffs.
The dollar bought 108.37 yen, up from 108.02 yen in New York but still below 108.57 yen in Tokyo earlier Tuesday.
On Wall Street, the Dow shed 1.60 percent, the S&P 500 fell 1.51 percent and the Nasdaq lost 1.56 percent.
Earlier London's FTSE 100 ended 1.04 percent lower, the CAC 40 in Paris tumbled 1.81 percent and Frankfurt's DAX slipped 1.34 percent.
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