Japan's Nikkei hits two-month low after chip rout
EWJ•Chip stocks lead losses
"There was no fresh event that soured sentiment; the market is simply extending its recent trend," said Shingo Ide, chief equity strategist at the NLI Research Institute.
Semiconductor equipment maker Screen Holdings 7735.T plunged more than 19%, its biggest percentage drop since January 2020. Memory chipmaker Kioxia 285A.T slumped as much as 15.11% while Tokyo Electron 8035.T shed 12.07%.
The Nikkei has closely tracked moves in South Korea's tech-heavy benchmark KOSPI .KS11 and the U.S. Philadelphia semiconductor index.
The KOSPI plunged more than 11% on the day after chipmaker SK Hynix's 000660.KS bumper quarterly results fell short of lofty investor expectations. The U.S. chip index fell almost 4.5% overnight on Tuesday.
"Japanese stocks may not have fully completed their correction, but they had fallen to levels where the adjustment could have run its course. For markets such as the KOSPI, the correction may still have further to go," Ide said.
Earnings, oil and gainers in focus
U.S. tech heavyweights Microsoft MSFT.O and Amazon AMZN.O are due to report their earnings this week.
In Japan, chip-testing equipment maker Advantest 6857.T is scheduled to announce results on Wednesday.
Oil prices rose more than $3 a barrel after U.S. and Saudi Arabia attacked Iran-linked forces in Iraq. O/R
In other stocks, Keyence 6861.T surged as much as 15.42%, among Nikkei's biggest percentage gainers, after the factory automation sensors and systems provider reported robust earnings.
Video game company Konami 9766.T gained 9.91% and cosmetics firm Shiseido 4911.T rose 7.35%.
There were 131 gainers against 94 decliners on the Nikkei.
