AI and chip stocks lift Nikkei to 71,052

2026-06-18

In morning trade on the Tokyo Stock Exchange on the 18th, the Nikkei Stock Average extended gains for a sixth straight session, closing 1,150 yen higher from the previous day at 71,052. At one point, the index rose more than 1,400 yen, and the market stayed firm even as rate-hike expectations grew after the US Federal Reserve's policy meeting. Artificial intelligence and semiconductor stocks led the advance.

Fed policy and Wall Street reaction

At the US Federal Open Market Committee meeting that ended on the 17th, the Fed kept its policy rate unchanged for a fourth straight meeting, as expected by the market. In the same set of projections released at the meeting, nine of the 18 participants projected at least one rate increase by year-end. Since no participant had expected a year-end hike in March, Aditya Bhave of Bank of America said he took the report as clearly hawkish. On Wall Street on the 17th, the Dow Jones Industrial Average and the other two major indexes all fell.

AI and chip stocks lead the market

Ordinarily, Japanese stocks would have been expected to open lower, but the market moved in the opposite direction on this day. The focus was the Philadelphia Semiconductor Index, or SOX, which is made up of major semiconductor-related shares that rose in the US market on the 17th. Intel, which announced that products using cutting-edge semiconductor manufacturing technology had entered trial production, climbed more than 3%, and even as the Fed's hawkish tone intensified, bullish expectations for AI and semiconductor stocks did not fade.

In the Tokyo market on the 18th, Murata Manufacturing at one point rose more than 18% to a record high, while SoftBank Group (SBG) also gained more than 5% at one stage. Buying also spread to Ibiden and Tokyo Electron, and these four names alone lifted the Nikkei by about 700 yen. Kioxia Holdings also drew buying, with its share price approaching 100,000 yen.

US economy and Middle East also offered support

Market sentiment toward AI and semiconductor stocks has turned increasingly bullish. SMBC Nikko Securities on the 17th upgraded its investment rating on Murata Manufacturing to the top rank. It expects demand for multilayer ceramic capacitors, or MLCCs, used in AI servers and other products, to boost earnings. IwaiCosmo Securities also raised its target price for SBG.

Underlying the view is optimism that hyperscalers will keep making aggressive AI investments. US retail sales for May, released on the 17th, rose 0.9% from the previous month, topping the market forecast for a 0.5% increase. Ikuo Mitsui, fund manager in the investment advisory division at Aizawa Securities, said he sees little concern that AI investment will lose momentum because consumer spending remains firm and the US economy is resilient.

Buying also picked up after the US and Iran signed a memorandum on the 17th to end hostilities, easing concern over the Middle East situation. In the morning session on the 18th, 60% of stocks on the Tokyo Stock Exchange Prime market rose. WTI futures fell to the 75 dollar range per barrel, spreading the view that this would help improve corporate earnings.

Lower crude prices tend to ease upward pressure on prices, and some also see this as not a situation in which the Fed would move to raise rates repeatedly. Yuho Tsuboi, chief strategist at Daiwa Securities, said expectations that the US economy can withstand a gradual tightening of monetary policy are supporting investor sentiment. The Nikkei average has risen 5,722 yen over the past five trading days through the previous day, and the market continues to push higher at present.

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