The Nikkei 225 extended its decline in the Tokyo market on the morning of the 2nd. Kioxia's earnings outlook, which fell short of expectations at the end of the previous week, and selling in AI and semiconductor stocks weighed on the market.
The Nikkei 225 was trading at around ¥62,800 at the opening of the morning session on the 2nd, extending its decline. Following the downside at the end of the previous week, broad-based downward pressure continued in the market.
Kioxia announced that it expects consolidated operating profit on an IFRS basis for the April-December 2026 period to be ¥5.2597 trillion. Although this represents a 19-fold increase year on year, it was below the market forecast of ¥5.5428 trillion indicated by the QUICK consensus, weighing on investor sentiment toward AI and semiconductor stocks.
In the U.S. equity market, Intel's earnings outlook fell short of market expectations and the SOX Index declined. This reignited declines in semiconductor stocks worldwide and spread to Japanese equities as a negative factor. A report that Blackstone had highlighted rating uncertainty surrounding a U.S. AI developer also left a sense of uncertainty.
Support for the Nikkei 225 was limited, with Recruit, Mitsubishi UFJ and Itochu declining. Meanwhile, Kirin Holdings and JR Central rose, resulting in mixed moves across individual stocks, while the TOPIX also extended its decline.
According to Nikkei QUICK News (NQN), overall market sentiment became more cautious following the morning session's trading, with the performance of AI- and semiconductor-related stocks and price movements in major names identified as the focus going forward.