Japan's benchmark Nikkei stock index lost about 0.8 percent on Monday, ending at its lowest level in a month and a half, as calls by top executives of major U.S. artificial intelligence (AI) developers to slow the pace of AI development triggered selling of related shares, according to Timothy Pope, an analyst for China Global Television Network (CGTN).
The 225-issue Nikkei Stock Average fell 518.35 points, or 0.81 percent, from Friday to close at 63,492.99, its lowest finish since July 30.
The broader Topix index, meanwhile, gained 29.91 points, or 0.74 percent, to end at 4,058.21.
The Nikkei index briefly shed around 2 percent in the morning session as investors sold AI- and semiconductor-related shares after Anthropic CEO Dario Amodei wrote in an essay Saturday that the industry should "slow the pace" on safety grounds, a call backed by Elon Musk and OpenAI CEO Sam Altman.
"Tokyo was feeling the pain today. Oil spiked above 107 U.S. dollars a barrel at one point. The Nikkei 225 ended the session down 0.8 percent. A slowdown in AI development is really not what a lot of the Nikkei heavyweights want to hear about. Many of them are exposed to the AI investment cycle either as suppliers or investors, so any slowdown of expansion in that sector could ultimately hit their bottom lines pretty hard. Kioxia was down 6.4 percent today and the tech investor SoftBank was the biggest decliner, down 10.7 percent," said Pope.
Pope noted that investors may have priced in a Bank of Japan (BOJ) interest rate decision scheduled this week.
"Japan is also looking down the barrel of an interest rate hike this week. The BOJ is set to meet on Friday to decide its next move. Markets have been primed to expect another quarter-point rise but it could very well be that an interest rate rise on Friday has already been priced in by Japanese investors," said Pope.
Japan's Nikkei stock index sinks as AI slowdown calls weigh on investor sentiment
