TOKYO - The Nikkei stock index extended losses Monday morning, briefly falling over 4 percent, as investors sought to lock in gains from recent sharp rises in heavyweight technology shares.
The 225-issue Nikkei Stock Average fell 2,547.72 points, or 3.83 percent, from Friday to 64,040.40. The broader Topix index was down 104.98 points, or 2.66 percent, at 3,844.11.
The U.S. dollar stayed firm in the lower 160 yen range in Tokyo, supported by speculation of a rate hike by the Federal Reserve, while wariness over potential currency intervention by the Japanese authorities kept its upside limited.
At noon, the dollar fetched 160.38-39 yen compared with 160.28-38 yen in New York and 159.94-96 yen in Tokyo at 5 p.m. Friday.
The euro was quoted at $1.1528-1529 and 184.88-90 yen against $1.1518-1528 and 184.57-67 yen in New York and $1.1632-1633 and 186.05-09 yen in Tokyo late Friday afternoon.
Stocks plunged, dragged down by artificial intelligence- and semiconductor-related shares tracking their U.S. counterparts as expectations grew for rate hikes by the U.S. central bank.
Investor sentiment was also dampened by rising uncertainty over the Middle East situation, following reports of new strikes by Israel, Iran and Iran-backed Lebanese militant group Hezbollah over the weekend.
"Demand for semiconductor-related stocks is likely to remain strong, so what we are seeing now appears to be a temporary pullback following the recent surge," said Maki Sawada, strategist in the Investment Content Department of Nomura Securities Co.
