A drop in the yen’s upward trend encouraged buybacks of shares linked to exports, but Japan’s Nikkei share average fell during early trade on Tuesday as domestic technology firms followed Wall Street’s falls to weigh on the index.
For the noon break, the Nikkei was down 0.1% at 38,055.62, while the Topix as a whole increased 0.3% to 2,669.84. With AI giant Nvidia falling ahead of its quarterly report this week, the S&P 500 ended the day down on Monday.
The tech-focused Nasdaq saw a decrease as well.
US technology giants Tokyo Electron and Advantest, which has Nvidia as a client, are two important players in the chip industry in Japan, and their shares have lagged behind the Nikkei overall.
The stock dropped 2.1% and 2.5 percent, respectively. Before Nvidia, the semiconductor giant, released its earnings on Wednesday, investors were holding off, according to Masahiro Ichikawa, chief market strategist at Sumitomo Mitsui DS Asset Management.
The market’s excitement for artificial intelligence has revolved around Nvidia, and the company is under pressure to provide exceptional outcomes.
“We’re in a situation where the bar has risen,” Ichikawa said, adding that if Nvidia’s earnings come in as expected, there might be some brief selling of tech shares.
The most percentage losses were seen in technology equities, with Lasertec Corp down 4.7%, Disco Corp down 3.1%, and Hitachi down 2.8%.
Tuesday saw a halt in the yen’s upward trend versus the dollar, which led investors to repurchase export-oriented stocks that had suffered during the previous session when the yen hit a three-week high of 143.45. Toyota Motor increased 1%, Honda Motor gained 1.4%, and Sony Group gained 1.7%.
The yen’s stop limited losses on the Nikkei while also pushing the larger Topix index into positive territory.
The 33 industry sectors listed on the Tokyo Stock Exchange saw a 2% increase in mining and a nearly 1% increase in coal and oil prices following an overnight spike in oil prices due to fears of potential supply interruptions.
