This file photo shows the Tokyo Stock Exchange. (Mainichi)

       TOKYO (Kyodo) -- Tokyo stocks fell Thursday as market sentiment was dented by the Japanese government's reported plan to declare a fresh coronavirus state of emergency in the capital amid a rapid rise in infections.

       The 225-issue Nikkei Stock Average ended down 248.92 points, or 0.88 percent, from Wednesday at 28,118.03. The broader Topix index of all First Section issues on the Tokyo Stock Exchange finished 17.36 points, or 0.90 percent, lower at 1,920.32.

       Decliners were led by mining, air transportation, and consumer credit issues.

       The U.S. dollar fell into the upper 109 yen range as the yen was bought on speculation that a drop in U.S. Treasury yields would narrow the interest rate gap between the United States and Japan, dealers said.

       At 5 p.m., the dollar fetched 109.78-79 yen compared with 110.58-68 yen in New York and 110.63-65 yen in Tokyo at 5 p.m. Wednesday.

       The euro was quoted at $1.1820-1821 and 129.76-80 yen against $1.1786-1796 and 130.40-50 yen in New York and $1.1825-1826 and 130.82-86 yen in Tokyo late Wednesday afternoon.

       The yield on the benchmark 10-year Japanese government bond inched down 0.005 percentage point from Wednesday's close to 0.025 percent, as investors bought the debt following an overnight fall in U.S. Treasury yields after the release of the minutes from the Federal Reserve's June meeting revealed policymakers did not plan to rush stimulus tapering.

       Bond yields move inversely to prices.

       Tokyo stocks were pressured amid worries over the likely coronavirus state of emergency declaration and its effect on the economy, after the capital reported 920 new infections Wednesday, the highest since mid-May and topping the figure from a week earlier for the 18th straight day.

       "Investors remained concerned about how effective another state of emergency would be in reducing infections," said Yutaka Miura, senior technical analyst at Mizuho Securities Co., noting people were continuing to travel despite the current quasi-emergency.

       The Japanese government is expected to make a decision later in the day on the COVID-19 state of emergency in Tokyo, the fourth since the start of the pandemic last year, until Aug. 22.

       If an emergency is declared, the Tokyo Olympics, slated to begin July 23, are likely to be staged without spectators at Tokyo venues, senior government officials said Wednesday, rather than with the planned maximum cap of 10,000.

       "Usually, holding the Olympics is a positive factor for higher share prices and a pump for the economy, but this time it is a risk factor for Japanese stocks," said Yoshinori Ogawa, senior general manager of the Investment Strategy Department at Okasan Securities Co.

       Investors will be carefully watching whether COVID-19 cases increase during the games, as a rise in infections is expected to pull down the support rate for Prime Minister Yoshihide Suga's government and may lead to political uncertainty, he added.

       On the First Section, declining issues outnumbered advancers 1,849 to 276, while 67 ended unchanged.

       Retailing and transport shares that are susceptible to the spread of infections were notably hit by the impending state of emergency, brokers said.

       Department stores such as Isetan Mitsukoshi Holdings fell 25 yen, or 3.0 percent, to 796 yen and J. Front Retailing slipped 12 yen, or 1.2 percent, to 995 yen.

       Among air and land transportation issues, Japan Airlines was down 68 yen, or 2.7 percent, to 2,452 yen and Keio dropped 80 yen, or 1.2 percent, to 6,460 yen.

       Trading volume on the main section rose to 1,144.05 million shares from Wednesday's 1,066.53 million shares.

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