TOKYO: Japan’s Nikkei share average fell on Wednesday as caution set in ahead of US AI darling Nvidia’s results and outlook later in the day, which some fear could be below market expectation.
The Nikkei seesawed between gains and losses before closing the morning session 0.45% lower at 38,242.35, while the broader Topix fell 0.46% to 2,697.67.
Nvidia, the world’s most valuable company, will report its third-quarter earnings after Wall Street closes on Wednesday.
Market participants are looking forward to the results to assess demand for chips and the sustainability of the AI euphoria.
“There are some risks and fears that (Nvidia’s) guidance will disappoint,” Kyle Rodda, senior financial market analyst at Capital.com, said in a note.
“The critical detail is demand for chips for the next quarter.” Investors are also keeping an eye on geopolitical risks after Ukraine used US ATACMS missiles to strike Russian territory on Tuesday.
In Japan, major chip-related shares edged down despite their US peers rising on Tuesday to lift the Nasdaq and S&P 500.
Tokyo Electron fell 1.1% to weigh the most on the Nikkei, while Advantest, which counts Nvidia among its customers, slid about 0.8%.
AI-focused startup investor SoftBank Group shed 0.3%. Shares of Seven & I Holdings jumped 8.4% following a report that the founding family was aiming to take the retailer private this financial year.
Tech and entertainment conglomerate Sony Group gained 2.9%. Reuters reported on Tuesday that Sony was in talks to acquire the publishing, anime and gaming powerhouse Kadokawa Corp.
Shares of Kadokawa climbed 18.7% on Wednesday to hit the upper limit.
Among other individual stocks, Tokyo Gas surged as much as 15% after a regulatory filing showed on Tuesday that US activist investor Elliott Management had taken a 5.03% stake in the company.
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