TOKYO, June 4 (Reuters) - Japan's Nikkei share average
pulled back from a record high on Thursday, as investors sold
AI-related stocks after Broadcom ( AVGO ) missed expectations for
second-quarter revenue, while renewed fighting between the U.S.
and Iran also soured risk sentiment.
The Nikkei was down 1.83% at 67,149.15, as of 0143
GMT. The broader Topix slipped 1.28% to 3,944.95.
The Nikkei closed above the 68,000 level for the first time
on Wednesday as optimism for AI-related stocks outweighed
concerns over the Middle East. The index traded more than 8%
above the 25-day average in the previous session, a sign of
overheating.
Wall Street tumbled overnight, with the S&P 500
falling 0.7% and oil prices rising around 2% as hostilities in
the Middle East erupted anew and talks between Tehran and
Washington showed little progress.
On Thursday, technology investor SoftBank Group
tanked 10% and was the top drag for the Nikkei. It was also the
index's biggest percentage loser.
Data centre material makers fell, with Ibiden ( IBIDF ) and
Fujikura ( FKURF ) slipping 7.3% and 5.8%, respectively.
The sharp decline of Broadcom ( AVGO ) prompted the market
to sell chip-related shares, said Shuutarou Yasuda, a market
analyst at Tokai Tokyo Intelligence Laboratory.
Broadcom ( AVGO ) fell more than 13% in extended trading after the
chipmaker missed Wall Street expectations for second-quarter
revenue.
"But fundamentals for chip-related shares remain strong.
These shares, along with AI-related stocks, will continue to be
investors' target," Yasuda said.
Bucking the trend, chip-making equipment maker Tokyo
Electron ( TOELF ) rose 1.18%, tracking a 1.4% gain for the U.S.
semiconductor index overnight. The stock was the biggest
support for the Nikkei.
Chip designer Disco rose 4%.
The shipping sector climbed 1.48% to become the
top performer among the 33 industry sub-indexes on the Tokyo
Stock Exchange (TSE).
Of around 1,500 stocks trading on the TSE's prime market,
64% fell, 32% rose and 2% traded flat.
(Reporting by Junko Fujita; Editing by Subhranshu Sahu)