Japan's Nikkei slumps over 3% on tech selloff, Iran tensions

Japan's Nikkei share gauge tumbled more than 3% on Friday as a global rout in chipmakers and an escalation in Middle East tensions prompted investors to shun risk assets.

The benchmark Nikkei 225 was down 3.6% at 64,443.84. The broader Topix slipped 2% to 3,950.08.

The decline followed overnight losses in U.S. equities, where technology stocks tumbled despite upbeat local economic data and a strong start to corporate earnings season.

"The market appears to be swayed by high earnings expectations for semiconductor-related companies," Sony Financial Group analysts said in a note.

Hawkish remarks from Fed officials on Thursday reinforced expectations for further U.S. rate hikes. Geopolitical tensions also remained elevated, with U.S. President Donald Trump threatening a broader escalation in strikes on Iran.

Advancers in the Nikkei 225 were outnumbered by decliners by 132 to 92, while one stock was unchanged.

Kioxia Holdings was the index's biggest percentage loser, tumbling 16.05% for its steepest one-day decline since November 2025. Shares of Taiyo Yuden fell 15.45%, while Screen Holdings lost 11.45%.

Shift was the index's top percentage gainer, rising 6.59%, followed by Seven & I Holdings, up 4.38%, and Nichirei, which gained 4.29%.