Tokyo stocks opened flat on Tuesday with investor sentiment weighed down by a strong yen.

The Nikkei 225 index inched up 0.05 percent or 12.51 points to 23,727.39 in early trade, while the Topix index of all first-section issues was up 0.04 percent or 0.81 points at 1,884.71.

Investors were watching yen exchange rates as a trading peg after subdued trading in Europe and a market holiday in the United States on Monday, said Toshihiko Matsuno at SMBC Nikko’s investment information division.

“Stock prices are prone to swings in currency rates,” he said, adding there were concerns over the yen’s further rise.

The dollar was trading at 110.71 yen on Tuesday against 110.56 yen in London on Monday, hovering around its lowest level against the Japanese currency since November.

A strong yen erodes Japanese exporters’ profits when repatriated and often drags down the Tokyo stock markets.

“Worries could spread if the yen strengthened beyond 110.18, the rate companies assumed in the December ‘Tankan’ survey,” Matsuno said, referring to a closely watched business confidence report by the central Bank of Japan.

In trading in individual stocks, SoftBank Group added 0.67 percent to 9,285 yen after rising more than three percent the previous day following reports it was considering listing its mobile unit.

Precision machinery maker Murata jumped 3.02 percent to 15,835 yen as the Nikkei business daily reported its annual operating profit would surge more than 15 percent.