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Tokyo stocks down 1.72% by break

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(Globalpost/GlobalPost)

Tokyo stocks fell 1.72 percent Thursday morning after losses on Wall Street, with investors cautious as the Bank of Japan wraps up its first policy meeting under new leadership.

The benchmark Nikkei 225 index lost 213.03 points to 12,149.17 by the break, while the Topix index of all first-section shares declined 1.22 percent, or 12.29 points, to 998.14.

The drop was a sharp turn-around from Wednesday when the Nikkei surged three percent.

"Markets are on edge, waiting for the Bank of Japan's long-awaited policy decision," said Hiroichi Nishi, SMBC Nikko Securities general manager of equities.

"It's entirely possible that while the BoJ will make some pronouncements today over monetary policy easing, it may wait until the second central bank meeting on April 26 to do more," he said.

Investors expect the BoJ to launch aggressive policy measures under new governor Haruhiko Kuroda, who has vowed to take "bold" steps in an effort to kickstart the stuttering economy.

"The disappointing US jobs and manufacturing data, the higher yen, yesterday's 3.0 percent run-up, and trepidation before today's BoJ policy board announcement are enough to cause investors jitters and simply sell and/or take profits," says Yoshihiro Okumura, general manager at Chibagin Asset Management.

"We'll just have to wait for the central bank in order to see a better illustration of investor commitment," Okumura said.

The Dow Jones Industrial Average sank 111.66 (0.76 percent) to 14,550.35 on Wednesday on the back of weak data on US jobs and the service sector.

The dollar remained weak after losing strength on Wednesday following the disappointing reports.

The greenback was at 92.89 yen in morning Asian trade, against 92.96 yen in New York Wednesday.

The euro bought $1.2846 and 119.34 yen compared with $1.2845 and 119.43 yen.

Mitsubishi Heavy rose 0.38 percent to 523 yen after a Nikkei business daily report that it had landed a joint contract to build four nuclear reactors in Turkey for $22 billion.

-- Dow Jones Newswires contributed to this article --

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http://www.globalpost.com/dispatch/news/afp/130404/tokyo-stocks-down-172-break