Japan’s Nikkei share gauge experienced a significant decline on Monday, primarily influenced by a downturn in technology shares following a call from leaders of major AI companies for a deceleration in development. The benchmark Nikkei 225 experienced a decline of 1.61%, reaching 62,979.17 in early trading. The broader Topix increased by 0.40%, reaching a level of 4,044.29. OpenAI Chief Executive Sam Altman stated that his company will refrain from going public in 2026, pointing to safety concerns regarding the rapid advancement of AI and its possible risks to humanity. On Saturday, Anthropic CEO Dario Amodei emphasised the need for AI companies to adopt a more measured strategy in their development efforts.
Markets are currently attentive to central bank meetings this week, with elevated expectations for rate hikes from both the Federal Reserve and the Bank of Japan, as inflationary pressures continue to be a concern. The Middle East crisis also weighed on sentiment, after Oman announced that a meeting between Iran and Gulf states regarding traffic management through the Strait of Hormuz was postponed due to recent Houthi strikes on Saudi Arabia and reports of an attack on a vessel. “Selling pressure is likely to hit AI and semiconductor-related stocks in Tokyo following a series of weekend comments calling for a slowdown in the pace of AI development,” Takayuki Miyajima said in a note. “Additionally, uncertainty surrounding the situation in the Middle East continues to weigh on sentiment.”
Breadth on the Nikkei exhibited a predominantly positive trend, with 160 advancers compared to 64 decliners; however, the significant influence of technology firms exerted downward pressure on the index. The most significant declines were observed in SoftBank Group, which fell by 11.73%, followed by Resonac Holdings with a decrease of 8.95%, and Taiyo Yuden, which saw a drop of 7.85%. The index’s largest percentage gainers included NEC, which increased by 6.26%, followed by Nomura Research Institute with a rise of 6.08%, and Recruit Holdings, which saw a gain of 5.87%.
