Japanese Stocks Plunge 7% as AI Investment Fears Spread After US Election

The Nikkei 225 fell more than 7% on Friday morning, dropping below 60,000 for the first time since May, following heavy losses on Wall Street driven by concerns over AI and data center investments after the Democratic Party’s midterm election victory. Japanese AI, chip, and data center stocks were hit hard, with Rohm sliding 20%, Furukawa Electric plunging over 19%, and SoftBank Group declining 11%. The Topix fell over 6%, while the Nasdaq composite dropped 5.5% and the Philadelphia Semiconductor Index plunged 12.3% overnight. The selloff reflects growing investor worry about the sustainability of tech spending, with the Democratic win raising expectations of stricter regulation or policy changes affecting the sector. The Nikkei’s decline marks its steepest drop in months, signaling broader market volatility.