Japan's Nikkei wavers as AI stocks weigh ahead of Nvidia earnings

According to Business Recorder, Japan's benchmark Nikkei traded mixed on Monday, edging both up and down by slim margins as artificial intelligence-related shares came under pressure. Nvidia is due to report its financial results on Wednesday. At 0156 GMT the index stood 0.2 per cent higher at 65,900.95, having swung between a 0.4 per cent gain and a 0.5 per cent loss.

Sentiment also suffered from inflation concerns and lingering uncertainty in the Middle East, with market participants anticipating a rate increase from the Bank of Japan at its September meeting. Yields on Japanese government bonds edged higher during morning trading. Bloomberg reported on Saturday that Nvidia told several of its biggest clients that prices for its AI servers will climb over 15 per cent, as memory costs surge.

Fujikura lost 3.5 per cent and SoftBank Group slipped 3.3 per cent, while Tokyo Electron gained 2.1 per cent as chip-making equipment producers outperformed. Nomura Securities strategist Wataru Akiyama said worries about chipmakers' profitability looked more like an excuse or spark for selling than a fundamental reason, pointing to a recent surge in open margin positions. He added that the earnings outlook for AI and semiconductor stocks remained unchanged, but with bond yields rising he doubted the Japanese market could sustain an upward trend.