Japan's Nikkei share average extends losses, last down 0.98%

Japan's Nikkei share average extends losses, last down 0.98%

Japan's Nikkei 225 index extended its losses on Monday, closing down 0.98% to a three-week low. The decline was largely attributed to a sell-off in tech stocks, both domestically and internationally. The broader Topix index dropped by 0.8%, reflecting the tech sector's influence on the Nikkei's performance [3].

The day's losses were driven by several factors. Chip equipment maker Advantest tumbled 9.1%, while SoftBank Group fell 6.3%. The broader US semiconductor sector also experienced a downturn, with the Philadelphia index dropping more than 3%. Month-end portfolio rebalancing and the absence of US markets for Labor Day contributed to the global market volatility [3].

The Nikkei's performance highlights the sector's vulnerability to shifts in tech stocks. The index's focus on tech names makes it sensitive to global market movements. The broader market's reaction to Nvidia's underwhelming results and Alibaba's competitive chip launch further underscored the sector's challenges [3].

This decline in tech stocks also signals a broader trend: increased competition in the semiconductor industry. Alibaba's new chip initiative is a significant development, challenging US tech dominance and intensifying the global semiconductor race. Japanese tech giants may face higher stakes and more market volatility as new players emerge and global supply chains shift [3].

In summary, Monday's Nikkei losses were driven by a tech sector sell-off, influenced by global market conditions and competitive pressures. The broader market's reaction to Nvidia and Alibaba's chip initiatives underscores the sector's vulnerability and the intensifying global competition.

References:
[1] https://www.theblock.co/post/368853/japan-post-bank-eyes-2026-rollout-of-dcjpy-deposit-token-for-asset-settlement-nikkei
[2] https://www.nasdaq.com/articles/stock-market-today-nio-jumps-glimmers-profitability-emerge
[3] https://finimize.com/content/japans-nikkei-sinks-as-tech-stocks-take-a-hit