On 28 July, the Nikkei 225 closed at ¥62,364, down ¥2,566 from the previous day. As the correction in AI and semiconductor stocks continues, attention is turning to overlooked high-dividend stocks.
The Nikkei 225 closed at ¥62,364 on 28 July, down ¥2,566 from the previous day. On a closing-price basis, it fell to the ¥62,000 range for the first time in approximately two months, since 21 May. There are multiple factors behind the decline, but they can broadly be grouped into two.
The first is the deterioration in the situation in the Middle East. A memorandum aimed at ending the fighting was signed in June, but tensions have since increased, including with the resumption of hostilities. The second is concern over excessive investment by major companies, with questions being raised over whether the aggressive capital investment plans outlined in their earnings results will generate commensurate future profits. AI is a theme that will support market growth over the long term, but for now it could lead to greater short-term price volatility.
It is expected to take until next year and beyond for the assessment of whether the enormous capital investment currently under way will truly translate into future profits to settle, and market conditions in which investor views are prone to diverge may continue. Caution is warranted over short-term price movements, particularly in AI- and semiconductor-related stocks.
Amid related content on efficient investment methods for periods when the market direction is difficult to predict, it is considered important to monitor the situation in the Middle East, corporate capital investment trends and developments in the AI market comprehensively in order to assess what lies ahead.