Japan's Nikkei rises for third day as data, earnings fuel AI optimism
- The benchmark Nikkei 225 advanced 0.80% to 60,942.48 as of the midday break
Japan's Nikkei share gauge climbed for a third day, fueled by renewed optimism in the AI sector following positive earnings reports and data, despite some mixed global signals.
- The rebound in AI-related stocks and market optimism.
- Key earnings reports from CoreWeave and OpenAI.
- The upcoming Nvidia earnings and its potential market impact.
TOKYO: Japan’s Nikkei share gauge climbed for a third straight session on Wednesday, as data and earnings reports restored some optimism to the battered AI sector.
The benchmark Nikkei 225 advanced 0.80% to 60,942.48 as of the midday break.
The broader Topix climbed 0.79% to 3,924.51. Japanese manufacturers’ sentiment rose to its strongest level in more than five years in November, a Reuters poll showed on Wednesday, as booming semiconductor demand underpinned broad-based optimism.
While US stocks closed lower overnight, as hotter-than-expected inflation data raised expectations for a Federal Reserve rate hike, AI cloud company CoreWeave, after the bell, said it would become profitable on an adjusted basis in the first half of 2028.
The Wall Street Journal reported that ChatGPT operator OpenAI’s quarterly revenue rose about 50% to $10 billion, even as it continued to post steep operating losses.
Global AI-related shares plunged last week on concerns that the US Congress could slow investment in the sector following the Democrats’ landslide victory in the midterm elections.
Investor focus now turns to third-quarter earnings from AI bellwether Nvidia next week, said Nomura Securities equity strategist Wataru Akiyama.
“If they are strong enough to dispel concerns about the earnings of these AI and semiconductor-related stocks, then that impact will likely spread to Japan’s major AI-related companies as well,” Akiyama said.
“This could serve as one of the catalysts for a recovery in those stock prices.”
SoftBank Group, one of Japan’s biggest AI investors, said after the close on Tuesday that it swung to a second-quarter net loss of 1.1 trillion yen ($6.93 billion).
Its shares tumbled 3.02% on Wednesday.
There were 149 advancers on the Nikkei 225 against 75 decliners.
The largest percentage gainers were Nichirei, up 8.18% and set for its biggest one-day gain since November 2022, followed by Kokusai Electric and Taiyo Yuden, up around 7.5%.
The biggest losers were Mitsui Kinzoku, down 7.28%, followed by DeNA, 6.90% lower, and Tokyu, which sank 5.63% toward its steepest one-day fall since August 2024.
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