Nikkei declines amid selling in auto stocks due to the rise in the yen

Japan’s Nikkei closed slightly lower on Tuesday as the yen’s rise against the dollar led to selling in automakers’ stocks.

The Nikkei fell 0.1 percent to 33,354.14 after opening 0.2 percent higher and trading slightly higher during the session.

The broader Topix index fell 0.2 percent to 2,367.79 points.

The three major stock indexes on Wall Street closed higher on Monday night, with the Nasdaq index rising 1 percent, supported by Microsoft stock, which rose to a record level after the company appointed prominent artificial intelligence executives.

The yen regained its strength as the dollar fell to new lows against major currencies with China intervening to raise the yuan.

Honda Motor shares fell 2.21 percent, Toyota Motor shares fell 1.62 percent, and Mazda Motor shares fell 4.5 percent.

The auto sector index fell 1.75 percent, becoming the worst performing among the 33 industrial sub-indices on the Tokyo Stock Exchange.

The strength of the yen affects exporters because it harms the value of profits achieved by companies abroad when they are transferred to Japan and calculated in yen.

The Nikkei rose to its highest levels since March 1990 on Monday before reversing course and closing lower.

The performance of commercial companies was weak, with Itochu shares falling 3.66 percent and Mitsui shares falling 2.9 percent.

The wholesale index fell 1.69 percent.

Display screen maker Sharp shares jumped 9.52 percent, becoming the best performer on the Nikkei index.