TOKYO, Feb 17 (Reuters) - Japanese stocks fell in choppy trade on Wednesday as the yen broke from its fragile weakening trend against the U.S. dollar after a rebound in crude oil prices fizzled and revived demand for the safe-haven Japanese currency.
The Nikkei share average fell 1.4 percent to 15,836.36, extending early morning losses in a rollercoaster session that saw share prices fall as the yen strengthened. The retreat took some of the shine off a dramatic rebound that saw Japan’s benchmark index add 7.4 percent over the past two days.
“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.”
Last week, the yen hit a 16-month high against the dollar amid a global rout in equities and commodities and reduced expectations for a near-term interest rate hike by the U.S. Federal Reserve. The currency is being closely watched by Japanese investors on edge over fears of a global economic slowdown, volatile oil prices and concerns about how banks will handle a negative interest rate policy implemented by the Bank of Japan on Tuesday.
The broader Topix slid 1.1 percent to end the session at 1,282.40 with all but two of its 33 subindexes in negative territory.
The JPX-Nikkei Index 400 declined 1.2 percent to 11,586.63. (Reporting by Joshua Hunt; Editing by Shri Navaratnam)