Japanese Shares Drop as US Tariff Fears and Strong Yen Hurt Investor Sentiment

Japanese shares dipped on Wednesday, led by losses in auto stocks, as investors grew concerned about US tariffs and the impact of a stronger yen on corporate profits.

The Nikkei 225 ended 0.8% lower, dropping 307.03 points to close at 38,134.97.

President-elect Trump disclosed plans to impose a 25% tariff on Mexican and Canadian goods and a 10% tariff on Chinese imports, citing concerns over border issues and drug trafficking.

The offshore yuan fell 0.1% to 7.2650 per dollar, nearing Tuesday's low of 7.2730.

On the corporate front, SAAF Holdings 11447 reported that its subsidiaries, Something, and Astec-Irie, secured a patent for a new penetration rod bending jig and measurement method for screw weight penetration tests, simplifying inspections and ensuring compliance with JIS standards.

Tokyu Construction 11720 posted a 59 million yen loss for the six months to Sept. 30, reversing a 2.51 billion yen profit last year. The company reported a loss per share of 0.56 yen, with sales dropping 11.9% to 118.63 billion yen.

In the privatization space, Seven & i Holdings 3382 is set to see its buyout potentially reach 9 trillion yen ($58.4 billion), with Itochu 8001 bringing in Daiwa Securities and the Ito family engaging SMBC Nikko Securities for advisory roles.