TOKYO (Kyodo) -- Tokyo stocks dropped Monday morning, the first trading day of 2025, as investors took profits following the Nikkei stock index's record year-end close.

The 225-issue Nikkei Stock Average fell 500.27 points, or 1.25 percent, from Monday last week to 39,394.27. The broader Topix index was down 26.89 points, or 0.97 percent, at 2,758.03.

The U.S. dollar hovered mostly in the upper 157 yen range, as the Japanese currency, which had briefly slid to the 158 yen level late last year, remains weak due in part to receding expectations the Bank of Japan will hike rates imminently, dealers said.

At noon, the dollar fetched 157.69-74 yen compared with 157.24-34 yen in New York at 5 p.m. Friday. Japanese financial markets were closed from last Tuesday for the New Year holidays.

The euro was quoted at $1.0314-0318 and 162.64-76 yen against $1.0304-0314 and 162.15-25 yen in New York late Friday afternoon.

Stocks stayed primarily in negative territory on Monday morning, weighed down by the Dow Jones Industrial Average's four consecutive days of losses while Japan's market was closed.

The market was also dragged down as some heavyweight shares, which surged last month, were sold, while U.S. stock futures retreated amid a lack of fresh trading incentives, brokers said.