The Nikkei 225 Index Closes 2.60% Lower

Japan’s Nikkei 225 Index dropped 2.65% to 62,908 on Thursday, closing at its lowest level in nearly three months as renewed selling pressure hit technology and artificial intelligence stocks. Investors continued to question whether massive AI investments would generate sufficient returns, particularly as Japanese companies play a significant role in the global AI infrastructure expansion. Sentiment was further dampened by rising oil prices following deadly attacks on a Saudi oil field, intensifying geopolitical tensions in the Middle East and adding to inflationary concerns. Japan remains especially vulnerable to regional disruptions due to its heavy reliance on oil imports from the Middle East. Technology stocks recorded notable losses, with Kioxia Holdings falling 6.8%, Advantest and Taiyo Yuden each declining 6%, SoftBank Group dropping 6.9%, and Tokyo Electron sliding 7%.

The Nikkei 225 Index dropped 1679 points or 2.60 percent on Thursday to close at 62942 points. Losses were led by Resonac Holdings (-11.06%), Screen Holdings (-8.44%) and Sumco (-7.73%).

The Nikkei 225 Index fell 1.6% to below 64,000 on Thursday, hitting five-week lows as the recent technology rally, supported by strong earnings and renewed optimism surrounding artificial intelligence, began to lose steam. Japanese equities also tracked a decline in US stock futures after major Wall Street companies delivered mixed results. Investors continued to assess whether substantial AI investments would eventually generate sufficient revenue. Meanwhile, rising oil prices following a deadly attack on a Saudi oil field added to concerns over supply disruptions and inflation. Japan remains particularly exposed to instability in the Middle East due to its heavy dependence on oil imports from the region. Technology stocks mostly traded lower, with notable losses from Kioxia Holdings (-0.9%), Tokyo Electron (-3.7%), SoftBank Group (-0.7%), Ibiden Co (-2.6%) and Fujikura (-2.8%).