05.11.202506:58:01UTC+00Japanese Shares Drop on Tech Rout

The Nikkei 225 Index dropped by 2.5% to end at 50,212, with the broader Topix Index declining 1.26% to 3,268 on Wednesday. This continues the decline from the previous session, primarily due to technology stocks struggling amid growing concerns about overvalued AI investments. Investor sentiment further deteriorated following alerts from leading Wall Street executives about potential market downturns in the next two years, coupled with increasing uncertainty regarding future U.S. interest rate cuts. The SoftBank Group plummeted 10% due to its significant involvement in AI and tech-related investments. Among other major technology firms, Advantest fell by 6%, Lasertec by 6.9%, Fujikura by 5.3%, Tokyo Electron by 4.1%, and Disco Corp by 8.4%. Meanwhile, Toyota Motor declined by 3.7% following profit shortfalls linked to U.S. tariff effects, whereas Nintendo surged 6.2% after it boosted its sales forecast for the Switch 2, anticipating strong holiday demand.