TOKYO: Tokyo stocks closed 1.26 percent lower on Thursday as investors awaited the reopening of Cypriot banks while political uncertainty in Italy and a stronger yen weighed on Japanese shares.
The benchmark Nikkei 225 index fell 157.83 points to 12,335.96, while the Topix index of all first-section shares shed 0.93 percent, or 9.69 points, to 1,036.78.
"Foreign investors were relatively quiet today, leaving reflexive strong-yen selling to determine the market," an equity trading director at a foreign brokerage told Dow Jones Newswires.
Cyprus confirmed banks will reopen on Thursday after a nearly two-week lockdown, during which Nicosia agreed a bailout with its creditors that will see bank deposits above 100,000 euros hit by a one-off levy.
The lenders will open at 1000 GMT but only under draconian capital controls, the first of their kind in the 17-nation eurozone.
In Italy centre-left leader Pier Luigi Bersani is struggling to establish a governing coalition ahead of a looming deadline, raising fears about stability in the recession-hit nation.
The renewed eurozone anxiety hit Wall Street on Wednesday, with the Dow Jones Industrial Average slipping 0.23 percent to 14,526.16.
In forex markets, the dollar slipped 94.11 yen, from 94.40 yen in New York late Wednesday ahead of a Bank of Japan meeting next week that is expected to see the launch of more aggressive easing by the central bank. The euro eased to 120.40 yen from 120.63 yen.
In stock trading, Sony fell 2.98 percent to 1,625 yen, Canon was off 2.12 percent at 3,450 yen and Nikon slipped 1.34 percent to 2,205 yen. Brokerage giant Nomura was down 1.52 percent at 580 yen.
Shares in GS Yuasa, the Japanese battery supplier for Boeing's troubled Dreamliner, plunged 11.11 percent to 392 yen after its power packs overheated or caught fire in Mitsubishi's electric and hybrid vehicles.
The automaker's stock was down 3.92 percent to 98 yen while major Dreamliner customer All Nippon Airways was 2.02 percent lower at 194 yen.
Electronics giant Sharp fell 3.59 percent to 268 yen on uncertainty over the state of a capital injection deal with Taiwan's Hon Hai Precision. (AFP)
