Japanese shares fall as investors book profits from rally

TOKYO: Japanese shares fell on Wednesday, led by declines in AI-related stocks, as investors tried to book profits from the latest fast-pitched rally.

The Nikkei fell 0.86% to 70,074.13 by the midday break.

The index exceeded the 70,000 mark this week for the first time in three months and has risen nearly 5% this month. The broader Topix slipped 0.59% to 4,158.89.

“At the beginning of Japan’s fiscal half, institutional investors tend to sell stocks to book profits,” said Taka Ikeda, senior portfolio manager at GSCI Asset Management.

“The move is noticeable in the current session after sharp gains in the market,” he said.

Chip-testing equipment maker Advances fell 1.7% after hitting a record high on Monday. Chip-making equipment maker Tokyo Electron lost 2.81%.

Memory maker Kioxia fell 4.06%. Gains in US shares were not strong enough to boost Japanese shares, Ikeda said.

US stocks ended higher overnight as crude oil prices steadied and US Treasury yields eased, offering some reprieve from concerns that have preoccupied investors in recent weeks, and allowing markets to turn their attention to the approaching third-quarter reporting season.

Nasdaq futures traded 0.15% lower in Asia trade, while S&P futures traded flat, weighing on Japanese shares.

Bucking the trend, technology investor Soft Bank Group edged up 0.38%.

Uniqlo-brand owner Fast Retailing was up 0.2%.

Beer maker Kirin Holdings fell 2.31% after a report said Japan’s Fair Trade Commission conducted a raid on four major beer makers on suspicion of violating anti-monopoly law.

Assai Group Holdings lost 1.54%. Of more than 1,500 stocks trading on the Tokyo Stock Exchange’s prime market, 67% fell, 29% rose and 3% traded flat.