The Nikkei 225 Index fell more than 2% to below 64,900 on Friday, erasing Thursday’s gains amid a broad, tech-led selloff driven by concerns over AI-related capital spending. Sentiment was further pressured by escalating tensions in the Middle East, which pushed oil prices higher and stoked renewed inflation worries.
On the macroeconomic front, Japan’s headline inflation accelerated to 1.7% in June from 1.5% in May, its highest level in six months, reinforcing expectations that the Bank of Japan may deliver additional interest rate hikes.
Technology and AI-linked stocks led the declines, with notable losses in Kioxia Holdings (-3.1%), Advantest (-3.9%), SoftBank Group (-5.1%), Tokyo Electron (-2.0%), Taiyo Yuden (-3.4%), Lasertec (-1.2%), and Murata Manufacturing (-2.1%).
Despite Friday’s pullback, the Nikkei 225 remains up more than 1% for the week and is on track for its first weekly gain in three weeks.
