The Nikkei average index rose and then fell back, briefly reaching 58,000 points

On February 12th, the Nikkei average index rose by more than 300 points, entering the 58,000-point range for the first time. A robust US economic performance and strong Japanese corporate earnings boosted buying. However, the rapid rise following the House of Representatives election began to show signs of fatigue. Affected by cautious sentiment at high levels, some heavyweight stocks were sold off, causing the Nikkei average to turn lower after its initial morning surge.

The Nikkei average closed at 57,639.84, down 10.70 points (0.02%) from the previous trading day. Advantest and Tokyo Electron, which had seen significant gains this year, experienced concentrated selling, with the two stocks collectively pushing the Nikkei average down by approximately 250 points.

Previously, the Nikkei average was in the 54,000-point range over the weekend. After the Liberal Democratic Party’s landslide victory in the House of Representatives election on February 8th, it broke through key psychological levels such as 55,000 points this week, and even briefly surpassed 58,000 points on the morning of the 12th. From a technical perspective, the stock price’s deviation from its 25-day moving average exceeds 7%, higher than the 5% level considered “overbought.” Stocks with significant short-term gains are more prone to profit-taking.

On the other hand, investor interest in artificial intelligence (AI) related stocks remains strong. On the 11th, the Philadelphia Semiconductor Index (SOX), composed of major semiconductor stocks, rose over 2% in the US stock market. Driven by the continued rise in US tech stocks and market expectations of improved investment returns, SoftBank Group once rose by 5%.