REFILE-Nikkei erases earlier gains as Kuroda's yen comment triggers selling
(Refiles to remove extra words from headline) TOKYO, June 10 (Reuters) - Japanese stocks fell to a three-week low on Wednesday, erasing earlier gains after Bank of Japan Governor Haruhiko Kuroda said that the yen was not likely to weaken much further. The Nikkei share average dropped 0.4 percent to 20,018.22 points by mid-afternoon, the lowest since May 19. Earlier, it rose to as high as 20,264.92. Kuroda, speaking to a lower house financial affairs committee, said the real effective exchange rate shows the yen is "very weak". The real effective exchange rate, which is the trade-weighted value of the yen versus other countries after adjustments for prices, shows that the yen is near its weakest level since the early 1973, according to BOJ data. "Kuroda basically put a brake on the recent weakness of the yen," said Norihiro Fujito, senior investment strategist at Mitsubishi UFJ Morgan Stanley Securities. "His comments were articulate enough to spook investors who sold the dollar and Japanese shares." Earlier in the day, Kuroda also said that the dollar may not necessarily rise further versus the yen if the U.S. Federal Reserve raises interest rates as traders may have already priced the possibility of a rate hike into the market. Exporters also turned lower, with Toyota Motor Corp falling 0.3 percent, Honda Motor Co shedding 0.2 percent and Fuji Heavy Industries declining 0.9 percent. The broader Topix fell 0.4 percent to 1,627.54 and the JPX-Nikkei Index 400 shed 0.4 percent to 14,696.53. (Reporting by Ayai Tomisawa; Editing by Kim Coghill)
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