Signs of deteriorating conditions surrounding AI-related US stocks were reported. While high-priced AI and semiconductor stocks in Japan continued to decline, a potential rebound was also expected on hopes for strong earnings announcements.
In the US stock market, concerns spread over deteriorating funding conditions surrounding AI-related stocks. Although the Dow Jones Industrial Average edged higher on 22 October, it fell back by $652 on 23 October. Selling spread across technology stocks, with semiconductor-related stocks particularly weak. WTI crude oil futures briefly rose into the $102 range on 23 October, and higher oil prices weighed on the market.
Japanese stocks fell sharply on 22 October, with the Nikkei down ¥1,713 at 62,907, its lowest level in approximately three months. It ended 23 October down another ¥214 at 62,693. Declines in AI- and semiconductor-related stocks in the US prompted broad-based selling across Japanese stock sectors, while TOPIX and the JPX Prime Index also fell.
In Chinese stock markets, the Shanghai Composite fell 1.48% on 22 October, but closed 0.89% higher than the previous day on 23 October.
Regarding overall market trends, concerns over excessive AI investment in the US and signs of funding adjustments stood out. In Japan, reports also indicated that investors were looking for opportunities for a rebound driven by expectations for strong earnings.
Among the top contributors to the Nikkei, movements in AI- and semiconductor-related stocks were important. On 22 October, negative contributors accounted for most of the total contribution, while on 23 October there were periods in which negative contributions were contained.