TOKYO, May 22 (Reuters) – Japan’s Nikkei share average
fell on Wednesday as investors awaited earnings from AI chip
leader Nvidia, while cautious outlook of domestic firms amid
uncertainties about rate and currency moves weighed on
sentiment.
The Nikkei was down 0.57% to 38,726.33 by 0206 GMT,
while the broader Topix had fallen 0.51% to 2,745.77.
“The whole world is awaiting the result of Nvidia. The
outcome will affect global stocks, particularly the U.S.
equities, which will affect Japanese stocks,” said Shuji Hosoi,
senior strategist at Daiwa Securities.
Nvidia, Wall Street’s third-largest firm by market
capitalization, will report results after the closing bell on
Wednesday in what is likely to be a significant market catalyst
and will test whether the outsized rally in AI-related stocks
can be sustained.
Japanese chip-giants Tokyo Electron and Advantest
fell 1.67% and 0.3%, respectively. These heavyweight
chip stocks had helped the Nikkei to scale a record intraday
high of 41,087.75 on March 22.
The index has been hovering below 40,000 since the beginning
of April, partly because sentiment was dragged lower by local
companies’ modest earnings forecasts, strategists said.
“Today’s declines were bigger than expected. Investors,
particularly foreigners, might be selling Japanese stocks to buy
overseas stocks whose outlook is stronger,” Hosoi said.
The markets are bracing for further rate hikes by the
central bank this year. Japanese government bond (JGB) yields
have risen this month on hawkish hints from the Bank of Japan as
it seeks to contain the yen’s depreciation.
SoftBank Group rose 1.55% to become the biggest
support for the Nikkei. Air-conditioning maker Daikin Industries
rose 1.8%.
Kusuri No Aoki Holdings rose 2.94% after Hong
Kong-based activist fund Oasis Management raised its stake in a
drug store chain.
Of the 225 components on the Nikkei, 61 stocks rose and 162
fell, while 2 were flat.
The shipping industry fell 2% to become the worst
performer among the Tokyo Stock Exchange’s 33 industry
sub-indexes.
(Reporting by Junko Fujita; Editing by Janane Venkatraman
)
Read More: Japan’s Nikkei falls as market awaits Nvidia earnings