Japan’s Nikkei stages cautious rebound after plunge on tech valuation concerns

TOKYO: Japan’s Nikkei share average staged a cautious rebound on Wednesday as investors remained wary ahead of pivotal earnings from artificial intelligence heavyweight Nvidia.

The Nikkei 225 Index advanced 0.4% to 48,899.69 in early trading, after logging its biggest drop in more than seven months in the previous session. The broader Topix was up 0.5%.

Concerns about the valuations of technology-related companies have rattled global equity markets.

US stocks ended lower overnight, with Nvidia’s shares sliding 2.8%.

The company will report quarterly results after the close in New York on Wednesday.

Japanese tech shares rallied after steep declines, but a surge in domestic interest rates and a diplomatic row with China continue to weigh on sentiment, said Nomura Securities strategist Fumika Shimizu.

“There appears to be dip-buying activity following the Nikkei’s significant drop yesterday,” Shimizu said.

“The focus will be on whether (Nvidia) can show revenue or profit forecasts that exceed market expectations.”

There were 155 advancers on the Nikkei against 67 decliners.

The largest gainers in the index were Furukawa Electric, up 4.4%, followed by NEC, which gained 4%.

The biggest losers were Renesas Electronics, down 4.4%, followed by Sumco, which shed 4.2%.