TOKYO: Japanese tech stocks slumped on Tuesday (Jan 28), mirroring a drop in US tech equities sparked by the release of a low-cost Chinese generative AI model.
US chipmaker Nvidia led a Wall Street slide, tumbling nearly 17% on concerns that Chinese competitor DeepSeek’s chatbot could threaten US artificial intelligence dominance. Nvidia stock rose significantly in after-hours trading.
Heavyweight chip-related companies matched the Nasdaq’s overnight dip, but increases in bank shares helped the Topix recover from early losses.
The Nikkei closed the morning session down 0.57 percent at 39,340.15, having fallen as high as 1.7% earlier in the day. The broader Topix was up 0.45% to 2,770.5. In Tokyo, Nvidia supplier Advantest was down nearly 10% on Tuesday, dragging the Nikkei the most.
SoftBank Group, which backs AI, sank 4.71 percent, while Furukawa Electric, which makes data centre cables, plunged 8%. Both had already fallen sharply on Monday, with SoftBank down 13% after two days and Furukawa down 20%. Taiwan and South Korea’s tech-heavy markets were closed for the holidays. Markets in China were also closed to celebrate the Chinese New Year, and Hong Kong trade closed at noon.
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