Tokyo: Tokyo stocks fell on Thursday due to a stronger yen and speculation of heavy selling linked to exchange-traded funds (ETFs), which weighed on investor sentiment. The benchmark Nikkei stock index, the 225-issue Nikkei Stock Average, closed at 39,646.36, down 174.92 points, or 0.44 percent, from the previous trading day.

According to Namibia Press Agency, selling by overseas short-term players intensified as the yen went up slightly against the U.S. dollar in the foreign exchange market. With the Nikkei nearing the psychologically significant 40,000 mark, profit-taking also emerged on concerns over short-term overvaluation. Adding to the bearish mood, concerns resurfaced about the negative impact of U.S. trade policy on the global economy and corporate earnings.

The broader Topix index also fell, losing 15.82 points, or 0.56 percent, to close at 2,812.34. On the Tokyo Stock Exchange prime market, declining issues outnumbered advancers 1,040 to 522, with 64 stocks unchanged.