``This seems to be an American scenario,'' said ING Barings Securities analyst Kunihiko Shiohara.

Analysts said a continued drop in the yen had stoked fears about a devaluation of the Chinese yuan and prolonged Asian economic turmoil, fuelling a downturn in US share prices.

``The current weakness in the yen was within market expectations, but what was not expected was that the yen's slide would take a sinister turn, rekindling fears that a devaluation of the yuan and Asian turmoil could have a negative impact on the US economy,'' said Merril Lynch Securities analyst Takaki Nakanishi.

Analysts added, however, that concerns about the US economy may prove short-lived, allowing the beneficial aspects of the weak yen to bolster the automaker's'shares once more.

``If the US economy is solid, then the (positive) effects of the weak yen will emerge,'' Nakanishi said.

Mazda Motor Corp and Honda Motor Co, which scored strong gains earlier in the summer, have retraced more than 10 per cent from their recent peaks and continued to decline on Wednesday, despite a further weakening of the yen to eight-year lows against the dollar.

At Wednesday's midday break, shares in Mazda were down 12 yen at 470, compared with a 22-month high of 531 on August 4.

Honda was off 120 yen at 4,950. The shares hit an all-time high of 5,530 on July 16.

Fuji Heavy Industries Ltd, however, was managing to hold the gains of its summer rally, ending the morning session at 830 yen, up 13 and barely below an eight-year high of 837 set at the beginning of the month.

The shares have risen sharply from 305 yen on December 25 last year.