TOKYO, May 18 (Reuters) - Japanese stocks reversed course and fell in choppy early afternoon trade on Wednesday after the yen gained strength against the U.S. dollar, dimming the outlook for exporters’ profits.
The Nikkei share average shed its morning session gains to sit 0.8 percent lower at 16,517.71 in mid-afternoon trade.
The yen initially gained on the dollar early in the morning session after expectations for further stimulus were hit by data showing Japan’s economy expanded at the fastest pace in a year in the first quarter, rebounding from the previous quarter’s contraction and beating median market forecasts.
Japan’s currency resumed its weakening trend in mid-morning after investors seemed to digest the GDP data and focus on strong U.S. inflation and rising expectations for further Fed rate hikes. But the yen has once again turned toward strength against the dollar, tipping the Nikkei index into negative territory in volatile trade.
Shares of home appliance and electronics exporter Panasonic Corp fell from 2 percent higher to 0.2 percent higher, while tyre exporter Bridgestone Corp shed all of its morning gains to sit 0.6 percent lower.
The broader Topix was 0.5 percent lower at 1,329.85 and the JPX-Nikkei Index 400 fell 0.5 percent to 12,027.41. (Reporting by Joshua Hunt; Editing by Simon Cameron-Moore)