Nikkei Ends Slightly Lower... Maintaining the 40,000 Level

"Profit-Taking Sell-Off in the Semiconductor Sector"

Japan's representative stock index, the Nikkei 225, closed slightly lower on the 5th, maintaining its position above the 40,000 mark.

[Image source=EPA Yonhap News]

On that day, the Nikkei index closed at 40,097.63, down 11.60 yen (-0.03%) from the previous session. The Nikkei opened lower and at one point in the morning fell to 39,840.

The Nikkei newspaper analyzed that following the Nikkei's historic entry into the 40,000 range the previous day, all three major U.S. indices closed lower, triggering a wave of profit-taking in the semiconductor sector. Semiconductor equipment manufacturer Advantest closed at 7,185 yen, down 2.6% from the previous session.

Additionally, air conditioning and chemical products manufacturer Daikin and biopharmaceutical company Astellas Pharma closed down 2% and 2.7%, respectively, compared to the previous session.

On the other hand, undervalued stocks such as those in construction, banking, and securities sectors saw continued buying interest mainly from foreign investors, which at one point in the afternoon lifted the index to 40,226, the newspaper reported.

The Japanese stock market has recently continued its rally, supported by improved earnings of export companies benefiting from the weak yen, expectations of escaping deflation (falling prices amid economic stagnation), and shareholder-friendly corporate management. The Nikkei index has risen about 20% since the beginning of the year.

This content was produced with the assistance of AI translation services.