TOKYO: Japan’s Nikkei stock average ended 2% lower on Friday, as chip-related heavyweights Advantest and Tokyo Electron dropped after a rally in Nvidia’s US-listed shares fizzled out.
The Nikkei fell 2.05% to end at 31,624.28 in its biggest daily drop in more than three weeks, but posted a 0.55% weekly gain.
The broader Topix fell 0.88% to 2,266.40 and lost 1.3% for the week.
Shares of Nvidia ended flat on Thursday, after rallying to a record high as the company unveiled a $25 billion stock buyback plan and record quarterly revenue powered by strong demand for its artificial intelligence-focused chips.
The three major US stock indexes ended down more than 1% each overnight, led by a drop in the Nasdaq after this week’s sharp gains and as investors were cautious ahead of Federal Reserve Chair Jerome Powell’s speech in Jackson Hole on Friday. “Japanese markets tracked Wall Street’s declines.
Foreign investors seemed to have lost their appetite for Japanese equities today,“ said Shigetoshi Kamada, general manager at the research department at Tachibana Securities.
“Investors were bracing for market declines after (Fed Chair Jerome) Powell’s speech later in the day. It appears his message will be hawkish.”
Investors across the globe awaited Powell’s speech for clues on the US central bank’s monetary policy.
Shares of Japanese chip-testing equipment maker Advantest tanked 9.99%, while chipmaking equipment maker Tokyo Electron slipped 5.93% and peer Screen Holdings lost 3.44%.
Technology investor SoftBank Group fell 3.05%. Of the 33 industry sub-indexes on the Tokyo Stock Exchange, only three rose, with the shipping sector gaining 0.15%.
Medical equipment maker Olympus rose 1.03% to become the best performer on the Nikkei.