TOKYO: Tokyo stocks tumbled 3.02 percent on euro zone concerns about likely Greece exit and a global fairness market sell-off was also fueled by continuous drop.
The Nikkei 225 index at the Tokyo Stock Exchange dropped 525.52 points on Tuesday to finish at 16,883.19 as the stronger yen dragged exporter shares lower.
The broader Topix index of all first-section shares lost 2.85 per cent, or 39.95 points, to end at 1,361.14.
Japanese shares were pressured on the back of a global equity sell-off with the euro sitting near nine-year lows against the US dollar and oil prices falling below the psychological $US50 ($A54.10) a barrel level.
‘Japanese stocks are following large declines in (the) US and Europe which were triggered by falling oil and Greek-related worries,’ said Hitoshi Asaoka, a Tokyo-based senior strategist at Mizuho Trust Banking Co.
‘We’re in a risk-off mood and technical levels alone might not be enough to halt the decline.’
Toshihiko Matsuno, chief strategist at SMBC Friend Securities, told Bloomberg News: ‘Unless the drop in oil prices stops, it’s possible the decline in stocks won’t either.’
On Wall Street, the Dow fell 1.86 per cent, the broad-based SP 500 lost 1.83 per cent and the Nasdaq shed 1.57 per cent.
Greek stocks sank more than five per cent, while the Paris, Madrid and Milan exchanges fell more than three per cent as markets fixated on the January 25 election in Greece that could see a victory for the left-wing Syriza party.
Markets fear the party will roll back austerity measures required under the IMF-EU bailout of the country, which could in turn lead it to exit the eurozone.
On currency markets, nervous investors moved into the yen – which is seen as a safe-haven in times of uncertainty and turmoil – with the US dollar slipping to 119.02 yen, from 119.61 yen in New York.
The euro rose to $US1.1956, up slightly from $US1.1933 in US trading and $US1.1864 on Monday in Asia, its lowest level since March 2006. It weakened to 142.29 yen from 142.74 yen.
Toyota shares fell 2.75 per cent to 7,300.0 yen while rival Honda was down 2.18 per cent at 3,453.5 yen with the automakers hit by the stronger yen and lower-than-expected December US sales figures.
Falling oil prices hit energy firms. Inpex tumbled 5.80 per cent to 1,241.5 yen and JX Holdings fell 2.78 per cent to 454.1 yen.
Sony lost 1.17 per cent at 2,439.5 yen.
