Nikkei Plunges 1,110 Points on Thursday as Chip Stocks Tumble

Tokyo's Nikkei 225 Stock Average experienced a sharp decline of 1,110.73 points, or 1.79%, closing at 61,077.90 on November 5. This marked the fourth consecutive day of losses and brought the benchmark to its lowest closing level in about five and a half months. The decline was primarily driven by heavy selling in semiconductor and AI-related shares, despite broader market gains.

The Nikkei had opened at 62,384.73 and briefly reached an intraday high of 62,653.98 before falling to 60,786.19. The selloff followed a 893.23-point drop on Wednesday, signaling a sharp reversal in technology shares after an earlier rally. Advantest, a major supplier of semiconductor testing equipment, was the largest contributor to the Nikkei's decline, slashing the index by about 1,097 points.

Other companies like Tokyo Electron, SoftBank Group, Ibiden, and TDK also weighed heavily on the index, reflecting investor concerns about technology spending and elevated valuations. The decline was influenced by the U.S. midterm elections, which raised the prospect of tighter oversight of AI development and data center construction in Washington.

However, the Tokyo market as a whole showed resilience, with the TOPIX index rising 45.01 points, or 1.16%, to close at 3,940.39. Major automakers, real estate firms, and other domestic-oriented businesses attracted buying interest, with Toyota Motor leading the pack with a 16.68% gain, driven by stronger-than-expected earnings and a raised profit forecast.