Japan's Nikkei slips on tech investment concern; Tokyo Electron plunges
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Japan's Nikkei share average slid on Friday, dragged lower by chip-related stocks on rekindled concerns about technology investment.Tech heavyweight Tokyo Electron plunged 17%, the most in almost a year, after the chip equipment maker slashed its profit forecast, citing changes in spending plans by semiconductor companies. Chip-testing equipment maker Advantest dropped 2.2%.The Nikkei 225 Index slid 0.4%, set for a 1.3% decline this week. The broader Topix edged up 0.4%, largely on the back of gains in utilities.U.S. shares slid overnight, with artificial intelligence-related companies such as Nvidia weighing on the PHLX semiconductor index.And shortly before Asian markets opened, U.S. President Donald Trump slapped dozens of trading partners with steep tariffs, further damping demand for risk assets."Semiconductor-related stocks with high price-to-book ratios started with a selling bias," said Maki Sawada, an equities strategist at Nomura Securities."Factors including the drop in the SOX index and the sharp decline in Tokyo Electron appear to be spreading to other semiconductor-related stocks and weighing on the overall market."After market hours on Thursday, Tokyo Electron cut its operating profit forecast by more than 20%. Capital investment in mature generation equipment in China fell during the June quarter, the company said.There were 176 advancers on the Nikkei against 47 decliners.The largest percentage gainer on the index was Fuji Electric with a 14% jump after the company lifted its full-year profit guidance.Japan Tobacco surged 5.8% after saying it expected operating profit to more than double in the year ending in December.The largest loser by percentage on the index was Tokyo Electron, headed for the biggest slide since August 2024. It was followed by Socionext, down 12%, and Hitachi, which lost 8.5%.
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