(Bloomberg) -- Japan’s Nikkei 225 Stock Average dropped Thursday, weighed by chip-related stocks on concerns about US President-elect Donald Trump’s trade policy. The broader Topix Index held onto gains, buoyed by financial firms that rallied on the back of higher US bond yields following Trump’s win.
The Nikkei was down 0.4% to 39,321.87 at lunchtime close in Tokyo, after earlier rising 1%. Semiconductor-related stocks were among the worst performers, with Lasertec Corp., Screen Holdings Co. and Disco Corp. sliding more than 3% on worries Trump will impose tougher trade policies on China.
“There is concern about how Trump’s policies, including export curbs, will affect chip equipment makers with high China exposure,” said Ikuo Mitsui, a fund manager at Aizawa Securities Co.
Disappointing corporate profit guidance further pressured Japan’s tech stocks, with chip-device maker Minebea Mitsumi Inc. tumbling as much as 8.9%, the most in three months, after its revised full-year net income forecast missed analyst estimates.
The Topix extended its rise from Wednesday, advancing by 0.9% as of 11:30 a.m. Insurers and export-oriented stocks, including automakers, were among the biggest drivers of the gauge’s gain, boosted by higher long-term yields and a weaker yen following Trump’s presidential victory.
Japan’s 10-year yield earlier climbed to 1%, its highest in about three months, after US Treasury yields rose Wednesday on expectations that Trump’s fiscal plans and proposal to hike tariffs will drive inflation higher and keep interest rates elevated.
“The ‘Trump trade’ is the biggest driver of stock buying in Japan today,” said Tomo Kinoshita, global market strategist at Invesco Management Japan. “But gains may be limited until we know whether the Republicans win the House of Representatives and US trade policy becomes clearer.”
--With assistance from Momoka Yokoyama.
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