TOKYO: Japan’s Nikkei share average sank on Friday, sending the index to its biggest weekly drop since early April, as heavyweight tech stocks tracked an overnight decline in US peers amid worries about stretched valuations.
The tech-heavy Nikkei ended the day down 1.2 percent at 50,276.37, taking its loss for the week to 4.1percent. That’s after rising to an all-time peak of 52,636.87 on Tuesday, the start of a holiday-shortened week in Japan.
In October, the benchmark index rallied 16.6 percent to book its best month in 35 years. Overnight, investors returned to selling the darlings of the artificial intelligence-fuelled rally that carried Wall Street, Tokyo and other global bourses to successive record peaks in recent months. Nvidia slid 3.7 percent and AMD dropped 7.3percent.
In Japan, startup investor SoftBank Group dropped 6.7percent and chip-testing equipment maker Advantest, a Nvidia supplier, slumped 5.5 percent, making them the Nikkei’s top two decliners in index-point terms.
“Rather than a change in the way investors fundamentally view AI stocks, there is this risk-off mood around how fast these stocks have rallied,” said Nomura Securities strategist Fumika Shimizu. Corporate results are also key for the market now, with Japan’s earnings season currently in full swing, she said.
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