Japan’s Nikkei 225 index fell on Friday, tracking a technology-led selloff on Wall Street overnight as investors dumped semiconductor and artificial intelligence-linked stocks amid concerns surrounding AI spending and valuations.
The benchmark Nikkei 225 declined 1.71% to 61,832.66 in early trading, while the broader Topix index dropped 1.26% to 3,947.11.
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According to Reuters, Japanese equities came under pressure after US stocks tumbled on Thursday, with the Nasdaq Composite falling 2.6% and the S&P 500 losing 1.21%. Technology stocks led sectoral declines as investors shifted towards defensive sectors such as consumer staples and healthcare.
Among major US stocks, Nvidia fell about 4% amid the selloff in AI and semiconductor shares. Meta Platforms dropped 7% following its earnings report as investors focused on its artificial intelligence spending, while Tesla declined 3.1% after reporting earnings and cutting its capital spending plans for 2026.
Selling was broad-based on the Nikkei, with 120 stocks declining against 96 advancing.
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Semiconductor-related and materials stocks led the losses. Sumco fell 8.95%, the index's biggest percentage loser, followed by Disco, which declined 7.59%, and Mitsui Kinzoku, which shed 6.65%.
However, some stocks bucked the broader market weakness. Aeon rose 3.98%, emerging as the Nikkei’s biggest percentage gainer, while Sapporo Holdings advanced 3.74%. Kikkoman gained 3.69% and was on track for its highest closing level since July 2024, Reuters reported.
The decline in Japanese shares reflected broader concerns about the sustainability of the technology rally, as investors reassessed AI-related investments and shifted towards less volatile parts of the market.
(Disclaimer: This article is based on inputs from agencies. These do not represent the views of The Economic Times.)
