Japan's Nikkei falls more than 2% on AI spending worries
EWJ•Domestic demand and shippers gain
Shares supported by domestic demand rose, with Central Japan Railway 9022.T and East Japan Railway 9020.T rising 1.17% and 0.6%, respectively.
Shippers rose, with Kawasaki Kisen 9107.T and Mitsui OSK Lines 9104.T up 0.61% and 0.88%, respectively.
Otsuka Holdings 4578.T, a maker of Pocari Sweat, rose 1.6% to become the top percentage gainer on the Nikkei.
Alphabet slide weighs on tech shares
Shares of Alphabet GOOGL.O sank 7% overnight after the company reported higher spending plans while it also burned cash. Wall Street indexes closed lower, with the Nasdaq .IXIC shedding more than 2%.
Concerns resurfaced over whether heavy spending on AI infrastructure is sustainable after Alphabet shares fell sharply overnight, said Kazuaki Shimada, chief strategist at IwaiCosmo Securities.
"The (Nikkei) index has been affected by overseas factors, not local cues. Many Japanese companies will start reporting their earnings from today, and if their outlook is strong, the index's trend may change," said Shimada.
Nikkei falls on AI spending concerns
Japan's Nikkei share average fell more than 2% on Friday, as a sharp decline in Google parent Alphabet shares spurred concerns about heavy AI spending.
The Nikkei .N225 was down 2.69% at 64,634.04 as of 0112 GMT, while the broader Topix .TOPX slipped 1.28% to 4,002.09.
The Nikkei has lost more than 7% so far this month, tumbling into correction territory last week. Its moves have been heavily affected by the tech-heavy South Korean benchmark KOSPI .KS11 and the U.S. Philadelphia semiconductor index .SOX.
