TOKYO (Kyodo) -- The Nikkei stock index ended down over 2 percent at a nearly four-month low Friday after another plunge on Wall Street overnight.
The 225-issue Nikkei Stock Average ended down 508.24 points, or 2.32 percent, from Thursday at 21,382.62, its lowest close since Oct. 18. The index extended losses to 771.85 points at one point.
The broader Topix index of all First Section issues on the Tokyo Stock Exchange finished 33.72 points, or 1.91 percent, lower at 1,731.97, lowest since Oct. 20.
Every industry category on the main section lost ground, led by mining, machinery, and oil and coal product issues.
Shares dropped from the outset as the second largest daily loss ever on the Dow Jones Industrial Average overnight and a surge in the 10-year U.S. Treasury yield to around a four-year high caught the market by surprise, brokers said.
"I hadn't thought (a U.S. stock plunge) could come twice in a week...It's like aftershocks always follow a big earthquake," said Mitsuo Shimizu, equity strategist at Japan Asia Securities Co.
The market's downturn started last Friday on a weak Wall Street together with a surge in bond yields. Higher yields increase borrowing costs for companies and reduce the risk appetite for equities.
"Tokyo shares had fallen to a level that was attractive for buying, but investors refrained from doing so after seeing a wild correction in the U.S. market," said Masahiro Ichikawa, senior strategist at Sumitomo Mitsui Asset Management Co.
Brokers said U.S. and Japanese shares have entered into a correction phase as they have dropped more than 10 percent respectively from their recent highs.
"The correction in equities may last into March, with volatility likely to remain high," Ichikawa said.
However, the Nikkei managed to stay above the 21,000 line amid expectations that the Bank of Japan will purchase exchange-traded funds to support the market, brokers said.
On the First Section, declining issues outnumbered advancers 1,796 to 244, while 24 ended the day unchanged.
Losses were seen across the board. Among blue chips, industrial robot maker Fanuc lost 1,120 yen, or 4.0 percent, to 27,000 yen, and Fast Retailing, the operator of casual clothing chain Uniqlo, was down 1,590 yen, or 3.7 percent, at 41,480 yen.
Energy issues were also among major decliners after crude oil prices fell overnight in New York.
Refiner Showa Shell Sekiyu slid 74 yen, or 4.9 percent, to 1,438 yen, and JXTG Holdings sank 33.40 yen, or 4.8 percent, at 656.50 yen.
Export-related issues were weighed down by the yen's appreciation against the U.S. dollar. Toyota Motor shed 86 yen, or 1.1 percent, to 7,465 yen, and Sony slid 146 yen, or 2.7 percent, to 5,174 yen.
Trading volume on the main section rose to 2,137.48 million shares from Thursday's 1,820.42 million shares.