Japan’s Nikkei share average edged lower on Thursday, dragged down by a sharp selloff in semiconductor-related stocks after Dutch chipmaking equipment giant ASML warned it may not achieve revenue growth in 2026.
As of 0214 GMT, the tech-heavy Nikkei had slipped 0.3% to 39,544.62. Industry heavyweights like Tokyo Electron and Advantest were the top drags on the index, reflecting investor concerns about the global semiconductor outlook.
The broader Topix index, however, managed a slight 0.1% gain, supported by gains in non-tech sectors.
Seven & i Holdings saw the biggest decline on the Nikkei, plunging 7.8% after Canadian convenience store operator Alimentation Couche-Tard dropped its takeover bid for the 7-Eleven parent company.
Chip manufacturing stocks took a significant hit, with Tokyo Electron down nearly 2%, Lasertec sliding 5.4%, and Advantest dropping 1.8%. The slide followed ASML’s cautious outlook, with the company citing uncertainty over U.S. tariffs impacting chipmakers’ factory plans.
Analysts at Jefferies noted that, like ASML, Japanese chip equipment makers have yet to enter a recovery phase. “Quarterly orders are likely to fluctuate, and while extreme ultraviolet lithography equipment orders surged last year, they’ve since stalled,” the analysts stated, predicting a potential recovery by 2026.
All eyes are now on Taiwan Semiconductor Manufacturing Co (TSMC), set to release its earnings later during Japanese market hours. As a global chip leader, TSMC’s report could sway investor sentiment in the short term.
Out of the 225 components on the Nikkei, 115 declined, 108 advanced, and 2 remained flat, showing a mixed market tone.
The Nikkei had previously found support from a weakening yen, but the currency slightly rebounded overnight, trimming some of the earlier gains in equities.
Energy shares were also under pressure, with a drop in crude oil prices dragging the Topix oil and coal sub-index down 1.44%, the worst performer among all 33 industry groups. The mining sub-index also declined by 1.40%, reflecting weakness in the broader resource sector.
As the global tech outlook remains uncertain and geopolitical risks linger, Japanese markets may continue to see elevated volatility in the near term.
