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2026.07.1600:35:30UTC+00Japanese Shares Drop in Tech Selloff

The Nikkei 225 Index dropped 2.6% to below 67,000 on Thursday, while the broader Topix Index lost 0.8% to close at 4,055, ending a two-session winning streak. The pullback was driven largely by renewed selling in semiconductor-related stocks, amid persistent doubts about the durability of the artificial intelligence rally.

Sentiment was further pressured by escalating tensions in the Middle East, which have pushed oil prices sharply higher this week and reignited concerns about inflation and the trajectory of interest rates.

At the same time, data showed that US producer prices unexpectedly fell in June, easing expectations of any near-term interest rate increase by the Federal Reserve.

Among the notable underperformers were major Japanese technology names, including Kioxia Holdings (-8.7%), Tokyo Electron (-5.2%), SoftBank Group (-5.9%), Advantest (-5.1%), and Fujikura (-5%).

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