As expectations grew that the Democratic Party would have an advantage in the U.S. midterm elections, the Nikkei 225 fell more than ¥2,000 at one point, while AI-related and semiconductor stocks were broadly sold. Concerns over the sustainability of AI investment have resurfaced, and some observers say concerns about tighter regulation are also affecting market sentiment.
The Nikkei 225 extended its decline after trading began on the 4th, falling more than ¥2,000 at one point. Deteriorating market conditions after the holiday weighed on investor sentiment, resulting in a broad-based decline.
The backdrop included financing trends among major U.S. IT companies and concerns over the sustainability of AI investment. AI-related and semiconductor stocks were broadly sold in the Tokyo market, putting downward pressure on share prices.
Market participants pointed to the view that the Democratic Party is in the lead in the U.S. midterm elections and said concerns were spreading that AI regulation would be tightened. Depending on subsequent reports, the market's reaction could change again.