Japan?s stock market extends losses amid AI spending concerns

Japan?s Nikkei 225 fell 0.8% to close at 62,189 on Monday, marking its third consecutive week of declines. Investor sentiment remained weak amid concerns about whether heavy spending on artificial intelligence (AI) can deliver enough returns. Markets are now looking to earnings reports from major technology companies this week for clearer signals on the outlook for AI-related stocks.

Investors are also preparing for upcoming interest rate decisions by the US, Japanese and European central banks. All three are widely expected to keep rates unchanged for now, although further rate hikes remain a possibility later this year.

Geopolitical tensions are adding to market uncertainty, with investors concerned about the possibility of renewed US strikes against Iran after next week?s midterm elections and potential retaliation by Tehran against US allies in the region.

Japanese technology stocks remained under pressure, with Advantest falling 3.9%, Tokyo Electron declining 3.7%, Ibiden dropping 3.1%, Disco Corp losing 1.8% and Kioxia Holdings slipping 1.6%.

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