Japan’s Nikkei share average fell sharply on Wednesday, tracking a broad sell-off in technology stocks on Wall Street as rising bond yields and renewed geopolitical uncertainty weakened investor appetite for risk, as per a report by Reuters.
The benchmark Nikkei 225 declined 2.97% to 65,459.71 in early trading, while the broader Topix fell 2.72% to 4,027.56.
Major U.S. stock indexes closed lower on Tuesday as fading expectations for a Middle East peace deal weighed on sentiment. Oil prices climbed, while government bonds across global markets came under pressure, pushing yields higher. The Philadelphia SE Semiconductor Index, which tracks U.S. semiconductor stocks, plunged 5%.
According to Reuters, rising long-term interest rates have increased concerns over stretched valuations of growth stocks, with semiconductor shares among the biggest casualties of the sell-off.
The decline was broad-based, with 178 stocks falling on the Nikkei 225 against 46 gainers and one unchanged.
Chipmaker Kioxia Holdings was the biggest decliner, dropping 10.25%, followed by Furukawa Electric, which fell 10.10%, and Pan Pacific International, down 9.75%.
SoftBank Group, a major investor in artificial intelligence companies, declined 6.47%, adding to pressure on technology-related stocks.
However, some stocks bucked the broader market trend. Mercari gained 5.28%, making it the biggest percentage gainer on the Nikkei, while Shiseido rose 2.56% and Otsuka Holdings advanced 1.91%.
The sharp decline in Japanese equities came as investors assessed the impact of higher global borrowing costs on richly valued technology and growth stocks, while geopolitical uncertainty added to market volatility.
