Japan's Nikkei 225 finished Monday's session almost unchanged, hiding an intraday plunge of more than 800 points and a sharp afternoon rebound. The broader Topix climbed to a fresh record close as buyers rotated out of AI names and into domestic and cyclical shares.
Japan's Nikkei 225 slipped 6.38 points, or 0.01%, to close at 69,737.69 on Monday, 6 July 2026, a flat headline that buried a violent swing. The broader Topix told a different story, advancing 0.92% to a record closing high of 4,101.96.
An 800-point round trip
The move looked calm only on the surface. Early buying pushed the benchmark up more than 600 yen from the open, but a reversal driven by profit-taking in artificial intelligence stocks then dragged the Nikkei down as much as 839.66 yen to an intraday low of 68,904.41 by the morning close. Bargain-hunting in the afternoon narrowed those losses considerably.
The Topix, meanwhile, kept climbing. Its new peak surpassed the previous record of 4,095.05 set on 22 June, marking a sixth straight session of gains. Breadth was strong: advancing issues numbered 1,142 against 384 decliners, with 28 of the market's 33 industry categories finishing higher.
Rotation out of AI, into cyclicals
The selling concentrated in technology. Kioxia Holdings, Taiyo Yuden, and SoftBank Group ranked among the more prominent decliners, and semiconductor equipment maker Tokyo Electron faced intermittent selling pressure. Concerns over excess capacity and rising competition from Chinese AI developers weighed on the sector through the session.
Money moved the other way into domestic and cyclical names. Shipping, transportation equipment, machinery, and oil and coal-related stocks led the advance, a shift commentators attributed in part to foreign buying supported by a weak yen. The currency traded in the mid-161 range against the US dollar, a tailwind for exporters. Mitsubishi Heavy Industries, Shin-Etsu Chemical, and Fast Retailing posted solid gains.
What comes next
The Nikkei sits just below the 70,000 threshold, and over the trailing twelve months it has advanced by more than 75%, according to Trading Economics data. Investors now turn to a run of domestic data this week, including household spending, producer prices, and machine tool orders, while the yen's path remains a critical variable given the risk of official intervention should depreciation accelerate.
Source: BBN Times
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