Yen Surge Puts Pressure on Exporters as Tokyo Stocks Fall

Tokyo stocks fell sharply on August 3 as electronics and auto shares were sold after coordinated U.S.-Japan yen-buying intervention drove the currency sharply higher, cutting into the weak-yen support that had underpinned exporters.

The broader Tokyo market also weakened, although the main pressure was concentrated in export-oriented manufacturers and technology shares. The decline followed a 2,494-point surge on July 31 when investors bought back semiconductor and artificial intelligence-related shares after the Bank of Japan kept interest rates unchanged and signaled that inflation risks remained tilted to the upside.

The August 3 session marked a shift in the market's central concern, with currency policy moving back to the front of the market narrative after Japan and the United States confirmed rare coordinated intervention to support the yen. The dollar, which had been around 160.33 yen at the previous Tokyo stock-market close, fell to the 157-yen range in early trade and briefly approached 155 yen in offshore trading.