Japan’s Nikkei 225 rebounded on Wednesday as investors returned to battered semiconductor and artificial intelligence shares, although the rally lost momentum after an early surge.
The benchmark climbed as much as 2.1% to 65,404.63 before paring its gain to around 1% at 64,718.98 by 12:57 pm Tokyo time. It had closed Tuesday at 64,075.42, its lowest in more than a month.
September exports rose 16.7%, extending Japan’s growth streak to 13 months but missing expectations.
The mixed signal leaves investors weighing a recovery in AI demand against slowing trade momentum, expensive energy and the prospect of higher domestic interest rates.
AI shares bounce, but conviction remains fragile
Early gains were concentrated among companies tied to the global AI buildout.
Kioxia Holdings climbed 5.1%, chip-testing specialist Advantest gained 4.8% and SoftBank Group advanced 3.5%. Lasertec rose 3.2% and Taiyo Yuden added 2.7%.
Buying extended to banks, with Mitsubishi UFJ Financial Group rising 1.6% and Sumitomo Mitsui Financial Group adding 1.4%. The broader Topix gained about 1.1% by the midday break.
The rebound followed Tuesday’s 6% slump in SoftBank and stronger guidance from US AI-server maker Super Micro Computer. Its forecast of $18.5 billion to $19.5 billion in quarterly revenue offered fresh evidence that infrastructure demand remains strong.
Commerzbank Research analysts linked improving risk appetite to corporate earnings and some relief in energy markets.
However, lingering AI financing concerns suggest investors may still be buying oversold shares rather than rebuilding longer-term positions.
Japan’s export surge masks an uncomfortable weakness
Japan’s September exports increased 16.7% from a year earlier, slowing from August’s 19.3% gain and falling short of the 20.1% forecast.
Shipments to the US rose 22.9%, while exports to China increased 8.6%, supported partly by demand for semiconductor equipment.
Imports grew 18.9%, leaving a ¥536.6 billion ($3.39 billion) trade deficit, nearly three times the ¥181 billion shortfall economists expected, according to Japan’s Ministry of Finance.
The deficit narrowed from August’s ¥1.1 trillion. Delayed crude deliveries amid Middle East shipping disruptions reduced September imports and October arrivals could lift Japan’s energy import bill again.
The figures highlight Japan’s dependence on overseas AI investment.
Strong chip demand is lifting exports, but slower-than-expected growth raises questions about whether customers can sustain current spending.
Oil and Bank of Japan policy pose the next test
Brent crude hovered near $110 a barrel as Middle East shipping disruptions continued.
The yen traded around 158.33 per dollar, supporting exporters’ overseas earnings but increasing the local-currency cost of imported fuel.
The Bank of Japan raised its policy rate to 1.25% in September and meets again on October 30. Economists largely expect a pause, although further tightening remains possible before year-end.
Mitsubishi UFJ Morgan Stanley Securities strategists identified improving sentiment towards Japanese government bonds following record demand at a 20-year auction.
Elsewhere, South Korea’s KOSPI rebounded about 3.7%, Hong Kong’s Hang Seng gained 1.1% and Shanghai’s Composite edged 0.1% higher as regional investors returned to technology shares.
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