Sharp Decline in Indices
Tokyo-SANA
The Japanese Nikkei index fell by approximately five percent today on Thursday, affected by sharp losses in technology stocks following media reports regarding distressed debts at the American cloud computing company (CoreWeave) and concerns about an interest rate hike in the United States.
Reuters reported that the Nikkei index, which is dominated by the technology sector, closed down 4.9 percent at 64,425.95 points, while the broader Topix index declined by 2.4 percent.
Losses in the Technology and AI Sector
Selling was concentrated in stocks related to artificial intelligence, as shares of chip equipment companies Advantest and Tokyo Electron plummeted by 15 percent and 7.8 percent, respectively. The SoftBank Group stock, an investor in AI-focused startups, fell by 9.3 percent.
During the night, a US consumer price index reading that came in higher than expected fueled expectations that the Federal Reserve (the US central bank) would have to accelerate interest rate hikes and keep them elevated for longer, negatively impacting the technology sector. The US Nasdaq Composite index fell 1.9 percent yesterday, Wednesday.
Pharmaceutical Sector Movements
CoreWeave's share price dropped by more than 15 percent, even after the company's CEO stated in a memo to employees that the volume of backlog orders at the company is sufficient to cover its debt obligations. The pharmaceutical sector emerged as the day's biggest winner, recording the best performance among sub-sectors on the Tokyo Stock Exchange, rising by four percent as investors shifted to this traditionally defensive sector.
Sumitomo Pharma recorded the largest gains in percentage terms on the Nikkei index, with its stock surging 15.8 percent. Out of 225 stocks on the Nikkei index, 136 declined, 87 rose, and two remained unchanged.
Source: Syrian Arab News Agency (SANA)
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