Tokyo stocks down at break on North Korea jitters

Growing tensions on the Korean peninsula are stoking demand for the safe-haven yen

Tokyo stocks fell Monday morning, extending four days of losses as growing tensions on the Korean peninsula stoked demand for the safe-haven yen.

US Vice President Mike Pence arrived at the gateway to the Demilitarised Zone dividing the two Koreas, in a show of resolve a day after Pyongyang failed in its attempt to test another missile.

In Tokyo, the dollar weakened to 108.20 yen from 108.91 yen in Asia trade on Friday. A stronger yen is generally bad for Japanese shares as it dents exporters' profitability.

"Geopolitical risk will continue to be closely monitored today as a strapping US Navy Armada moves within striking distance of North Korea," said Stephen Innes, senior trader at forex firm OANDA.

"With all the military adventurism in play, those insidious wartime market correlations take force as the risk-off theme grips markets.

"To what extent the markets need to price in geopolitical risk more actively into their psyche will likely drive nearer term sentiment."

Tokyo's benchmark Nikkei 225 index, which closed at a 2017 low on Friday, lost another 0.31 percent, or 57.45 points, to sit at 18,278.18 by the lunch break.

The broader Topix index of all first-section issues was flat, edging down 0.01 percent, or 0.14 points, to 1,458.93.

In Tokyo trading, Toyota slipped 1.00 percent to 5,740 yen by the break, while Honda fell 0.80 percent to 3,092 yen.

Mitsubishi UFJ Financial Group fell 0.93 percent to 646.1 yen and Sumitomo Mitsui Financial was down 0.99 percent to sit at 3,784 yen.

Tensions between Pyongyang and Washington have soared in recent weeks, as a series of North Korean weapons tests have provoked ever-more bellicose warnings from US President Donald Trump's administration.

Trump has ordered a naval strike group, led by the USS Carl Vinson aircraft carrier, to the region, though the vessels remain a long way from the peninsula.