Tokyo stocks took a downturn Thursday on the back of the yen's appreciation and overseas market falls. The 225-issue Nikkei average of the Tokyo Stock Exchange shed 156.16 points, or 0.67 percent, to close at 23,319.37, after rising 20.64 points Wednesday. The Topix index of all first section issues closed down 5.95 points, or 0.36 percent, at 1,638.40, following a 3.51-point rise the previous day. The market got off to a weaker start and plunged deeper in the morning, with sentiment chilled by the yen's strengthening against the dollar and a drop in the U.S. Dow Jones Industrial Average futures in off-hours trading, brokers said. Bearish performances of Chinese and other Asian shares also weighed on Tokyo stocks throughout the afternoon session, they added.

Japan's three leading automakers expect a stronger yen will cost them around 14 billion in lost operating profit this year alone -- just as they need to invest more in everything from cleaner fuel to driverless cars. After three years of supernormal profits on the back of a weaker currency, Toyota Motor, Nissan Motor and Honda Motor now face a reality check after the yen has turned around. While the recent years' currency boon filled automakers' coffers -- Toyota alone has around 10 billion in cash -- a squeeze on margins will put them under pressure to focus their investments, analysts say. "How to respond to yen rises while securing profits and continuing future investments -- this balance is important," Toyota Executive Vice President Takahiko Ijichi said this past week. The dollar climbed roughly 60 percent against the yen between late 2011 and mid-2015, a huge windfall for Japan's carmakers, but so far this year it is down roughly 9 percent against the yen.