Japan's Nikkei on track for best week in 5 months despite Nvidia turmoil
- The broader Topix advanced 0.63% to 3,962.08 and was headed for a weekly gain of about 7%, its strongest since mid-August 2024
Japan's Nikkei index achieved its best week in five months, fueled by upbeat earnings and renewed AI optimism, despite recent turmoil surrounding chipmaker Nvidia.
- Nikkei's significant weekly gain and rebound from a previous sharp drop.
- Semiconductor stocks leading the advance despite Nvidia's selloff.
- Investor optimism for the broader AI sector and US rate hike speculation.
TOKYO: Japan’s Nikkei share average was on track for its best week in five months on Friday, rebounding from a sharp drop the previous week as upbeat earnings and renewed AI optimism lifted sentiment, despite turmoil surrounding chipmaker Nvidia.
The Nikkei was up 1.25% at 61,576.91, as of 0140 GMT, putting the index on track to finish the week with a 7.3% weekly gain, its biggest since the week of June 15.
The broader Topix advanced 0.63% to 3,962.08 and was headed for a weekly gain of about 7%, its strongest since mid-August 2024.
Semiconductor stocks led the Nikkei’s advance, with Advantest gaining 5.9%, Tokyo Electron rising 3% and Kioxia adding 2.9%.
The gains came despite a selloff in Nvidia shares overnight, which dragged US stocks lower.
However, rival chipmakers Broadcom and Alphabet rose, suggesting investor optimism about the broader AI sector remained intact.
“The rise in semiconductor- and AI-related shares, which had been under pressure for a relatively long period, appears to have been a factor behind this week’s gains in the Nikkei average and Topix,” said Maki Sawada, equities strategist at Nomura Securities.
Reports surrounding Nvidia CEO Jensen Huang’s departure have also raised questions about the company’s future direction and the implications for US chip export policy and access to the Chinese market.
Japanese shares had already weakened in the previous session amid concerns over the Nvidia developments, helping set the stage for Friday’s recovery, Sawada said.
The market breadth was positive, with 138 advancers in the Nikkei 225, against 82 decliners and 5 unchanged stocks.
Banking shares on the Tokyo bourses gained 1%, tracking a rise in US Treasury yields amid speculation about potential US rate hikes.
Japan’s three largest banks were due to report earnings later in the day.
The largest percentage gainers in the index were Amada Co up 9.46%, followed by Socionext gaining 6.77% and Trend Micro up by 6.61%.
The largest losers were Terumo, down 7.39%, followed by Haseko, trading 6.12% lower, and Mercari , which lost 3.68%.