Japan's Nikkei trims 2025 surge as tech stocks take a breather

[TOKYO] Japan’s Nikkei share gauge edged lower on the final trading day of 2025, dragged down by the technology sector that has been a key driver of the year’s massive gains.

The benchmark Nikkei 225 Index slid 0.4 per cent to close at 50,339.48 on Tuesday (Dec 30), while the broader Topix lost 0.5 per cent. The Nikkei surged 26 per cent in 2025, a third consecutive yearly gain and the most since 2023. The Topix climbed 22 per cent.

Japanese equities have been on a roll, benefitting from a corporate governance push by the Tokyo Stock Exchange and more lately from euphoria over artificial intelligence investment.

The Nikkei got another leg up, touching an intraday record high of 52,636.87 on Nov 4, after Sanae Takaichi was elected prime minister on a campaign of huge fiscal stimulus.

“The first half of the year was weighed down by global economic instability, including rising prices, labour shortages, and US tariffs,” Takaichi said at a ceremony at the exchange after the closing bell.

“But in the latter half, the resilience of Japanese companies, together with policy support, propelled the Nikkei to a remarkable turnaround, rising past the 50,000 mark for the first time in history.”

Wall Street’s main indexes ended lower overnight, as tech stocks retreated from last week’s rally that pushed the S&P 500 to record highs.

The drop in US equities and a slump by domestic AI heavyweight SoftBank Group were the main factors dragging Japanese shares lower, said Nomura Securities strategist Wataru Akiyama.

“Rather than a fading of expectations around AI, it appears to be driven by end-of-year adjustment selling amid thin trading,” Akiyama said. “So, we are not overly concerned, given how much share prices have risen this year.”

SoftBank slid 1.9 per cent and was the biggest drag on the Nikkei, after the company said it would buy digital infrastructure investor DigitalBridge Group in a deal valued at US$4 billion. SoftBank shares surged 93 per cent in 2025.

There were 61 advancers on the Nikkei index against 162 decliners. The largest gainers in the index were Fujitsu , up 2.3 per cent, followed by Screen Holdings, which added 1.6 per cent. The biggest losers were Sumitomo Metal Mining , down 4.8 per cent, followed by online retailer Rakuten Group, which slid 2.7 per cent. REUTERS