TOKYO: Japan’s Nikkei share average sank on Friday, as tech stocks tracked Wall Street peers’ overnight losses amid mounting concerns over sky-high valuations.
The Nikkei fell 1.8 percent to end the day at 50,376.53. The broader Topix lost 0.7 percent to 3,359.81.
Artificial intelligence-linked firms led the drop, with chip-testing equipment maker Advantest falling 5.5 percent, startup investor SoftBank Group sliding 6.6 percent and chip-making tool manufacturer Tokyo Electron shedding 6.1 percent.
Stocks linked to data centre expansion also retreated, with Hitachi and Fujikura down 5 percent and 6.4 percent, respectively.
“It looks like investors are taking profits on these AI-related stocks,” as worries about stretched valuations simmer, said Nomura Securities strategist Fumika Shimizu.
“We are seeing a bit of sector rotation,” particularly into companies that have posted strong earnings this season, she added.