Major Asian stock markets weakened on the 26th as worries over high oil prices and AI (artificial intelligence) overinvestment overlapped. The result is interpreted as a freeze in investor sentiment.
According to the Nikkei newspaper, Japan's Nikkei 225 index ended the morning session of the 26th at 62,214.66, down 0.76% from the previous session. The index repeatedly moved up and down around the previous close in early trading, as bargain-hunting buying clashed with profit-taking selling. The decline at one point exceeded 500 points, but there were also moments when buying by overseas investors turned it higher.
By sector, most AI chip stocks lacked strength. Advantest and Tokyo Electron were weak, and Ibiden, Kioxia and Screen Holdings also fell. In contrast, oil-related and trading company stocks were strong, with Mitsubishi Corp. and Toyota Tsusho among the gainers.
Earlier on Wall Street, the three major indexes, including the Dow Jones Industrial Average, all fell on the 23rd (local time). On the same day in the New York crude futures market, the nearest-month price of West Texas Intermediate (WTI) jumped 3.8% in a day to close above $103 a barrel. With Middle East tensions continuing, investors were weighed down by worries that rising oil prices could drag down Japan's economy and corporate earnings.
A wait-and-see mood was thick in the market. A strategist at a Japanese brokerage said, “Ahead of key releases such as earnings from major Japanese companies and the monetary policy meetings of the US and Japanese central banks, a wait-and-see mood is likely to spread.”
Greater China markets also lost strength. The Shanghai Composite Index on the Chinese mainland was trading at 3,671.00 that morning, down 0.52% from the previous session. As uncertainty over the Middle East situation and rising oil prices dampened investor sentiment, sell orders came in on most stocks. As of 11:40 a.m., Taiwan's Taiex was down 1.81% from the previous session and Hong Kong's Hang Seng Index was down 0.09%.