Japan’s Nikkei index experienced a decline on Thursday, influenced by a downturn in the semiconductor sector, as investors became more apprehensive about the spending forecasts related to artificial intelligence. According to source, the Nikkei-heavily weighted toward technology stocks-declined by 2.7%, closing at 62,907.84 points, thereby negating the 0.9% increase observed on Wednesday. The broader Topix index experienced a decline of 1.1%, subsequent to a 0.9% increase the day before.
Despite generally strong results, shares of the U.S.-based chip equipment manufacturer Lam Research experienced a decline in after-hours trading. Kazuyoshi Saito, an analyst at IwaiCosmo Securities, highlighted apprehensions about demand stemming from China. “In China, there was a rush to purchase manufacturing equipment ahead of schedule, driven by fears of tightening regulations; it appears the market had not fully accounted for the subsequent pullback,” Saito said. Wataru Akiyama observed that Japanese stocks had already been impacted by robust earnings reports released after the market closed on Tuesday-particularly from U.S. companies SpaceX and Super Micro Computer-rendering them susceptible to profit-taking in the latest session.
“The market is looking ahead to 2027, questioning whether capital expenditure in the field of artificial intelligence will be sustained; there is a great deal of caution among investors,” he said. Chip-sector stocks were the primary contributors to the declines observed on the Nikkei index, as shares of Advantest experienced a significant drop of 6%, while Tokyo Electron saw a decrease of 7%. Shares of Fujikura, a manufacturer of data center cables, experienced a decline of 6.2%. Meanwhile, shares of SoftBank Group, which invests in AI-focused startups, experienced a decline of 6.9%.
Nevertheless, shares of certain technology-related companies experienced an increase. Cybersecurity firm Trend Micro experienced an 8.7% increase in its shares, representing the most significant percentage rise on the Nikkei index. This followed the discovery of critical security vulnerabilities in the PHP programming language, prompting several European governments to take their websites offline to protect their systems. Shares of IT services provider Shift experienced an increase of 8.6%, whereas shares of IT consulting firm BayCurrent saw a rise of 3.8%.
