TOKYO: Tokyo shares ended volatile trading down 0.69 percent Monday as the positive effect of Japan's yen-selling intervention to safeguard exports quickly wore off, brokers said.
The Nikkei index at the Tokyo Stock Exchange opened lower after the yen hit a new post-war high against the dollar but the benchmark index moved into positive territory on the intervention.
The latest yen-selling operation pushed the dollar above 79 yen from the new low of 75.32 yen hit early Monday.
But the Nikkei quickly fell back, ending down 62.08 points at 8,988.39. The broader Topix index of all first-section issues lost 7.37 points or 0.96 percent to 764.06.
Market participants "know that the trend (of yen strength) is unlikely to change even if Japan unilaterally intervened in the market," said Hideyuki Ishiguro, supervisor of investment strategy at Okasan Securities.
Japan confirmed it had intervened in currency markets for the first time since August to weaken the yen.
The August intervention briefly sent the dollar above 80 yen from below 77 yen where it had been before authorities stepped in.
"The question, as in the past, is sustainability," said Norihiro Fujito, a senior investment strategist at Mitsubishi UFJ Morgan Stanley Securities.
"Previous interventions have had an impact for two or three days, but it has not led to a trend shift," he told Dow Jones Newswires.
Intervention "may also have been necessary to prevent the earnings momentum for Japanese companies from slipping further (due to the strong yen) and the Thai floods," he said.
Concerns have grown in Japan that the strong currency, which erodes the repatriated profits of exporters and makes their goods less competitive, could undermine a fragile recovery from the March 11 earthquake and tsunami.
Shares of major Japanese exporters gained on the yen's fall, with Canon rising 0.98 percent to 3,600 yen and Toyota up 0.45 percent at 2,644.
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