The Nikkei 225 fell ¥275 under the influence of the US midterm elections, while TOPIX rose 1.5%. Selling spread across AI- and semiconductor-related stocks, creating a sharp divergence between the indices and individual stocks.
The Nikkei 225 continued to decline on the 5th in the Tokyo stock market, closing the morning session at ¥61,913.51, down ¥275.12 from the previous trading day. Concerns about tighter AI regulation spread after the Democratic Party made gains in the US midterm elections, prompting concentrated selling in semiconductor- and electronic-component-related stocks.
On the TSE Prime Market, trading value totaled ¥5.708057 trillion. The number of advancing issues was 1,281 (82%), while 261 issues declined (16%), making it an unusual market in which the performance of the indices and individual stocks diverged sharply.
Among individual stocks, Toyota Motor was bought, while semiconductor- and AI-related stocks including Advantest, Kioxia Holdings and SoftBank Group fell sharply. Some stocks helped cushion the Nikkei 225's decline, but weakness in AI-related shares weighed on the market.
Market participants are divided, with views split between those pointing to headwinds for AI-related stocks following the Democratic surge and those highlighting the advantage of export-related stocks resulting from a policy shift. Many expect rotation of funds between sectors to be the focus going forward.