The Nikkei share average extended its earlier losses during mid-afternoon trading on Wednesday after the yen broke from a fragile weakening trend, unnerving investors.
The Nikkei share average fell 2.2 per cent to 15,704.21 in afternoon trading. Japan’s benchmark index added 7.4 per cent in a dramatic rally over the past two days, but stalled on Wednesday amid volatility in global markets and crude oil prices.
“The rally itself has been extraordinary but very thin and the failure of the yen to continue on the fairly steady path of weakening we’ve seen in the past couple of days has been reflected as nervousness in the Nikkei,’’ said Stefan Worrall, director of Japan equity sales at Credit Suisse.
“It’s been a very volatile two weeks and nerves are still frayed despite the fact that we’re off the bottom of those extreme sessions we saw last week.’’
The broader Topix slid 1.9 per cent to 1,272.69 and the JPX-Nikkei Index 400 declined 1.9 per cent to 11,494.40.