Business Recorder
TOKYO: Japan’s Nikkei share average pulled back from a record high on Thursday, as investors sold AI-related stocks after Broadcom missed expectations for second-quarter revenue, while renewed fighting between the US and Iran also soured risk sentiment. The Nikkei was down 1.83% at 67,149.15, as of 0143 GMT. The broader Topix slipped 1.28% to 3,944.95. The Nikkei closed above the 68,000 level for the first time on Wednesday as optimism for AI-related stocks outweighed concerns over the Middle East. The index traded more than 8% above the 25-day average in the previous session, a sign of overheating. Wall Street tumbled overnight, with the S&P 500 falling 0.7% and oil prices rising around 2% as hostilities in the Middle East erupted anew and talks between Tehran and Washington showed little progress. On Thursday, technology investor SoftBank Group tanked 10% and was the top drag for the Nikkei. It was also the index’s biggest percentage loser. Data centre material makers fell, with Ibiden and Fujikura slipping 7.3% and 5.8%, respectively. The sharp decline of Broadcom prompted the market to sell chip-related shares, said Shuutarou Yasuda, a market analyst at Tokai Tokyo Intelligence Laboratory. Broadcom fell more than 13% in extended trading after the chipmaker missed Wall Street expectations for second-quarter revenue. “But fundamentals for chip-related shares remain strong. These shares, along with AI-related stocks, will continue to be investors’ target,” Yasuda said. Bucking the trend, chip-making equipment maker Tokyo Electron rose 1.18%, tracking a 1.4% gain for the US semiconductor index overnight. The stock was the biggest support for the Nikkei. Chip designer Disco rose 4%. The shipping sector climbed 1.48% to become the top performer among the 33 industry sub-indexes on the Tokyo Stock Exchange (TSE). Of around 1,500 stocks trading on the TSE’s prime market, 64% fell, 32% rose and 2% traded flat.
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