The Nikkei 225 Index Closes 1.33% Lower

Japan’s Nikkei 225 Index dropped 1.3% to close at 64,075 on Tuesday, marking a one-month low as concerns over AI spending and higher borrowing costs continued to pressure technology shares. Japanese equities also diverged from Wall Street’s overnight rebound, with local technology firms particularly exposed to renewed selling in AI-related stocks. Major decliners included Kioxia Holdings (-3.4%), SoftBank Group (-6%), Taiyo Yuden (-5.1%), Fujikura (-6.5%) and Tokyo Electron (-2.6%). Financial stocks also suffered significant losses, with Mitsubishi UFJ falling 3.7%, Mizuho Financial declining 5% and Sumitomo Mitsui dropping 3.9%. In corporate developments, credit-default swap spreads linked to SoftBank Group rose to their highest levels in nearly four years, reflecting growing concerns over the company’s AI-related financing needs and the possibility of a major acquisition.

The Nikkei 225 Index fell 864 points or 1.33 percent on Tuesday to close at 64053 points. Leading the losses are Resonac Holdings (-11.12%), Fujikura (-7.05%) and Sumco (-6.99%).

The Nikkei 225 Index fell 1% to around 64,300 on Tuesday, approaching one-month lows as concerns over AI spending and rising borrowing costs continued to weigh on technology stocks. Japanese equities also diverged from Wall Street’s overnight recovery, led by chipmakers, as local companies remain highly vulnerable to AI-related selloffs. Notable decliners included Kioxia Holdings (-2.9%), SoftBank Group (-4.8%), Taiyo Yuden (-3.4%), Fujikura (-4.2%) and Tokyo Electron (-1.7%). Financial stocks also weakened, with Mitsubishi UFJ falling 1.5%, Mizuho Financial declining 2.8% and Sumitomo Mitsui slipping 1.6%. On monetary policy, Bank of Japan Governor Kazuo Ueda said underlying inflation was already nearing the central bank’s 2% target, reinforcing expectations of a potentially tighter policy stance. Meanwhile, investors are awaiting upcoming trade and inflation data for further indications of Japan’s economic outlook.