YEN HITS TWO-MONTH HIGH IN 153 ZONE VS. DOLLAR, TOKYO STOCKS PLUNGE

TOKYO, Jan 26 (Bernama-Kyodo) -- The yen hit a two-month high in the upper 153 range against the US dollar in Tokyo on Monday amid wariness of possible yen-buying interventions by Japanese and US and authorities, reported Kyodo News.

Tokyo stocks plunged, with the key Nikkei index briefly losing over 2 per cent, as export-oriented auto and electronics issues were hit by the yen's appreciation, which reduces exporters' profits when repatriated.

The Japanese currency jumped by more than 5 yen against the dollar from the 159 level in Tokyo on Friday, with Japanese and US authorities suspected of having conducted a "rate check" with major banks late last week, a move typically thought to precede a market intervention.

"It would not be very effective if only Japan intervenes in the market, but speculation grew that Japanese and US authorities could conduct a joint intervention," Yuzo Sakai, Chief Manager of Business Planning at Ueda Totan Forex Ltd., said.

On Monday, Atsushi Mimura, Vice Finance Minister for International Affairs, avoided commenting on whether a rate check had been conducted but told reporters the government will "respond appropriately by closely coordinating with US authorities as necessary."

At 4 pm., the dollar fetched 154.26-27 yen compared with 155.68-78 yen in New York and 158.37-40 yen in Tokyo at 5 p.m. Friday.

The euro was quoted at US$1.1850-1853 and 182.79-84 yen against US$1.1824-1834 and 184.23-33 yen in New York and US$1.1736-1737 and 185.88-92 yen in Tokyo late Friday afternoon.

Stocks fell almost across the board, as the yen's surge fueled concern about the adverse impact on earnings of exporters, with Toyota Motor dropping 4.1 per cent to 3,477 yen and Honda Motor shedding 4.4 per cent to 1,544.5 yen.

The 225-issue Nikkei Stock Average ended down 961.62 points, or 1.79 per cent, from Friday at 52,885.25. The broader Topix index finished 77.21 points, or 2.13 per cent, lower at 3,552.49.

On the top-tier Prime Market, the main decliners were transportation equipment, bank and electric appliance issues.

"The trend of a stronger yen is unlikely to continue, with the market projecting the next interest rate hike (by the Bank of Japan) will not take place until April or June," said Masahiro Yamaguchi, Head of Investment Research at SMBC Trust Bank.

"If that's the case, the selling of export-related issues will not last long and investors are likely to start adopting a wait-and-see stance," he said.

Heavyweight technology shares such as SoftBank Group and Tokyo Electron were also pressured after US chip giant Intel Corp. gave a weaker-than-expected sales forecast for the January-March period.

-- BERNAMA-KYODO