Tokyo shares extend gains, briefly top 71,700 as AI, chip stocks lead

2026-07-01

Strong U.S. stocks lend support

The Nikkei average opened higher for a second straight session in the Tokyo stock market. At one point, it rose to the 71,700 level, about 1,700 yen above the previous day. Following the previous day’s gains on Wall Street, buying is spreading in Tokyo, led by artificial intelligence and semiconductor-related stocks.

In the U.S. stock market on June 30, the Dow Jones Industrial Average extended gains, closing 136 points, or 0.26%, higher at 52,319, renewing its record high for a second consecutive day. The advance was driven by Caterpillar, a major construction machinery maker seen benefiting from expanding corporate investment in AI infrastructure, and U.S. semiconductor giant Nvidia.

Tankan eases growth worries

Last week, related shares were sold in Japan and overseas on concerns about the profitability of AI investment. But on June 30, the Philadelphia Semiconductor Index, which is made up of major chip-related stocks, rose nearly 4%. Buying returned to Advanced Micro Devices, Sandisk and KLA, while in Tokyo Kioxia, which jointly develops memory with Sandisk, as well as Advantest and Tokyo Electron, rose.

In the Bank of Japan’s June quarterly Tankan survey for June, released on the 1st, the diffusion index for business conditions at large manufacturers came in at plus 22, above the market median forecast of plus 16 in a QUICK poll. It was the highest level since the March 2018 survey, or in 8 years and 3 months, and the DI for large nonmanufacturers also marked its highest level since August 1991. Easing worries about the economy has also supported stocks.

The Tokyo Stock Price Index also extended gains. SoftBank Group and Ibiden rose, while Taiyo Yuden, TDK and Screen Holdings also advanced. On the other hand, KDDI and Chugai Pharmaceutical fell. Nitori Holdings and J. Front Retailing also declined.

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