On January 28, Japanese chip-related stocks plummeted significantly under the influence of a major sell-off in U.S. tech stocks. SoftBank Group's shares fell by 3.7%, Tokyo Electron's shares dropped by 4.2%, and semiconductor equipment manufacturer ADVANTEST's shares nosedived by as much as 9.6%, marking the largest single-day drop since September 4, 2024. This decline reflects the global tech stock market turbulence triggered by AI themes.
U.S. Tech Sector Sparks Selling Spree
The decline in Japanese chip stocks stemmed from a ripple effect from overnight U.S. and European markets. On January 27, the U.S. Nasdaq Composite Index fell by 3.07%, with AI-themed tech companies generally under pressure, leading the market decline. NVIDIA's shares plummeted nearly 17%, erasing $592.7 billion in market value overnight, setting a record for the largest single-day market value loss in U.S. stock history. Broadcom's shares fell by 17%, AMD's shares dropped by 6.37%, and Microsoft's shares declined by 2.14%.
Analysts pointed out that the plunge in NVIDIA's shares was mainly driven by concerns over the valuation of the AI industry. With the rise of domestic AI companies like DeepSeek, known for their low-cost, high-efficiency models, the dependence on high-end GPUs and computing power has significantly decreased, leading investors to reassess the future growth prospects of chip companies.
Global Tech Sector Turbulence Continues
This sentiment of concern has spread to the Japanese market, with chip-related companies being the first to be affected. As key players in the semiconductor field, Japanese companies swiftly followed suit after the drop in U.S. tech stocks, showing the common pressure facing the global tech sector.
SoftBank Group, due to its extensive layout in chip technology investments, became one of the main victims of the decline, with its shares reducing by 3.7%. Tokyo Electron and ADVANTEST were impacted because of their semiconductor equipment businesses, reflecting investors' worries about slowing global semiconductor demand.
AI Themes Drive Market Changes
AI themes are the core factors of the current market turbulence. Tech stocks in the U.S. and Japan are highly sensitive to AI-related news, particularly major technological breakthroughs in the AI industry that could disrupt the existing market structure. The rise of emerging companies like DeepSeek is reshaping investor confidence in traditional AI giants, while also challenging the valuation of the semiconductor industry.
Currently, the market remains focused on the development of AI technology and its long-term impact on chip demand. As the tech stock earnings season unfolds, investors will continue to closely watch industry dynamics and potential policy adjustments. The future performance of the global tech market remains full of uncertainties.
