The Nikkei Average narrowed its loss from a temporary decline of more than ¥1,400, standing at ¥64,534.03 in the morning session. Buying of futures by overseas investors provided support amid the market's reaction to weakness in U.S. semiconductor stocks.
In the Tokyo stock market on the morning of the 19th, the Nikkei Average fell sharply toward the midday close. The decline exceeded ¥1,400 shortly after the open, but then narrowed, with the index trading in the low ¥64,000 range. The midday level was ¥64,534.03, down ¥790.26, or 1.21%, from the end of the previous week.
Following declines in major U.S. technology stocks, the SOX fell 3.8% and the Nasdaq Composite declined more than 2%. Persistent high long-term interest rates and concerns about the flow of funds into AI-related businesses weighed on the market. Uncertainty over the outlook for the profitability of AI investment, in response to developments in overseas markets, also affected investor sentiment. CoreWeave's share price plunged amid financial concerns.
Overseas short-term investors were active in the morning. Futures buying on the view that a drop below ¥64,000 represented a buying opportunity eased selling pressure in cash equities. Fast Retailing, Ibiden, and TDK fell, while KDDI, BayCurrent, Recruit, and Kioxia were bought.
The focus ahead will be assessments of the profitability of AI investment and earnings announcements from major U.S. technology companies. The short-term direction of the market is expected to depend on semiconductor demand, oil prices, and U.S. interest rates.