TOKYO - Tokyo stocks ended almost unchanged on September 15, with the Nikkei 225 closing around 63,485, down about 8 points, as a rebound in SoftBank Group and selected artificial intelligence-related shares offset caution over oil above $107, rising bond yields and this week’s Federal Reserve and Bank of Japan policy meetings.
The Nikkei began lower after U.S. stocks fell overnight and concerns remained over the pace of artificial intelligence development, higher energy prices and global interest rates. The index briefly slipped toward the 63,000 level before buying returned to large technology shares, lifting the benchmark above 64,000 in morning trading.
The rebound faded later in the day as investors avoided aggressive positions before the Federal Reserve’s September 15-16 meeting and the Bank of Japan’s September 17-18 decision. The market finished little changed, showing both the resilience of dip-buying and the difficulty of extending gains while oil, rates and currency policy remain unsettled.
The session followed the sharp split seen on September 14, when the Nikkei fell as AI and semiconductor-related shares were sold, while the broader TOPIX rose on buying in value and domestic-demand shares. On September 15, the Nikkei found support from a partial recovery in the same AI-related names that had dragged it lower the previous day.
SoftBank Group was the main stabilizing force. The stock rebounded sharply after its steep fall on September 14, when investors sold the company on worries that calls for a slowdown in artificial intelligence development could hurt the pace of AI investment.
SoftBank remains Tokyo’s most visible proxy for global AI investment sentiment because of its exposure to OpenAI, Arm, robotics, digital infrastructure and other large-scale technology themes. Its large weighting in the Nikkei means that a rebound in the stock can support the index even when the broader market remains cautious.
The recovery suggested that investors were reassessing the previous day’s selling as excessive. The concern over AI safety and slower development remains real, but the market appeared less certain that it would immediately derail demand for chips, data centers, memory, software and infrastructure.
Kioxia Holdings also rose, helping support the semiconductor and memory side of the AI trade. The company remains one of Tokyo’s clearest gauges of confidence in high-bandwidth memory, AI servers and data-center demand.
Kioxia’s share price has been extremely volatile since July, moving sharply with global memory stocks, Nvidia-related sentiment, South Korean chipmakers and speculation over AI capital spending. Its rebound on September 15 helped ease concern that the AI selloff would deepen immediately.
Advantest and Tokyo Electron also remained closely watched. Advantest is one of Japan’s most direct beneficiaries of advanced AI chip testing, while Tokyo Electron is central to semiconductor manufacturing equipment. Both stocks are highly sensitive to U.S. technology sentiment and global bond yields.
Fujikura, Furukawa Electric, Ibiden, Murata Manufacturing, Taiyo Yuden, TDK, Lasertec and Kokusai Electric remained key indicators of whether the AI trade can broaden beyond SoftBank and memory shares. These companies represent optical fiber, cables, advanced substrates, electronic components, chip equipment and data-center infrastructure.
The September 15 session showed that investors are no longer treating AI as a simple one-way trade. Strong long-term demand remains, but investors are now weighing that demand against safety concerns, regulatory risk, funding costs, high valuations, energy constraints and the possibility that AI-related capital spending could become more selective.
The broader market remained cautious. Even though SoftBank and Kioxia helped the Nikkei recover, investors were still reluctant to buy the full market before two major central bank decisions. Many participants preferred to wait for clearer signals on U.S. and Japanese interest rates.
Oil prices remained one of the largest risks. Brent crude traded above $107 a barrel after renewed attacks by Yemen’s Iran-aligned Houthis and continuing tension around Saudi energy infrastructure, the Red Sea and Middle East shipping routes.
For Japan, oil above $100 is a major inflation threat because the country imports most of its energy. Higher crude prices feed into gasoline, electricity, aviation fuel, shipping, logistics, chemicals and manufacturing.
The pressure is especially serious because households are already dealing with higher food, utility, transport and service prices. Wage growth has improved, but another energy shock could quickly erode gains in real purchasing power.
The yen traded around 154 to 155 against the dollar, remaining stronger than the 160 range seen earlier in the summer but weaker than last week’s seven-month highs. The currency’s movement has become one of the most important signals for the Tokyo market.
A stronger yen helps reduce imported inflation and supports importers, retailers and households. A weaker yen supports exporters by raising the yen value of overseas earnings. The September 15 level left investors balancing both effects.
The yen’s September rally faces a major test this week. Markets have built expectations that the BOJ will raise rates, but Reuters reported that some strategists warn the central bank could disappoint investors if Governor Kazuo Ueda does not signal a sufficiently hawkish path after the meeting.
The BOJ kept its policy rate at 1% at its July 30-31 meeting, but board member Hajime Takata dissented in favor of raising it to 1.25%. Since then, inflation data, producer prices, wage gains, upgraded GDP figures and currency volatility have strengthened expectations for a rate increase this week.
Markets are widely expecting the BOJ to raise the policy rate to 1.25% at the September 17-18 meeting. The more important question is whether Ueda signals another move later this year or presents the September increase as a more cautious adjustment.
If the BOJ sounds too dovish, the yen could weaken again, reviving imported inflation and intervention concerns. If it sounds too hawkish, Japanese government bond yields could rise further and pressure equity valuations, mortgages, corporate borrowing and government finances.
Japan’s bond market remained tense. The benchmark 10-year JGB yield moved back toward 3%, a level that has become a major psychological marker after decades of ultra-low rates.
A 10-year yield near or above 3% changes the investment environment. It raises the discount rate applied to future earnings, pressures high-valuation growth shares, increases corporate borrowing costs and lifts the government’s debt-servicing burden.
Higher yields support banks by improving lending margins and investment income, but they also create risks for financial institutions holding large bond portfolios. That makes the impact of rising rates mixed even for sectors that normally benefit from BOJ normalization.
The fiscal issue is becoming more important. Prime Minister Sanae Takaichi’s government is trying to balance household relief, defense spending and long-term strategic investment while maintaining confidence in Japan’s public finances.
The government’s growth strategy calls for large-scale public and private investment through fiscal 2040 in semiconductors, artificial intelligence, energy security, defense, shipbuilding, robotics, space and other strategic industries.
Those priorities support many of the sectors investors continue to watch closely, including chip equipment, AI infrastructure, advanced materials, optical networks, power systems and defense-related manufacturers. But rising JGB yields make the funding question more difficult.
The Finance Ministry’s budget process remains under close scrutiny because higher assumed interest rates increase projected debt-servicing costs. Investors want evidence that Japan can fund household support and strategic investment without undermining fiscal discipline.
The Federal Reserve meeting is the immediate overseas event. Markets see a U.S. rate hike this week as highly likely, with investors also pricing further tightening over the next year. That has kept U.S. bond yields high and added pressure to global equity valuations.
For Japan, the Fed decision matters through the dollar-yen exchange rate, U.S. Treasury yields and global appetite for risk assets. A hawkish Fed could support the dollar and push the yen weaker, but it would also keep pressure on AI and technology valuations.
A less hawkish Fed could support growth shares by lowering U.S. yields, but it might also strengthen the yen and hurt Japanese exporters. This makes the outcome complicated for Tokyo: what helps technology valuations may hurt currency-sensitive exporters, and what helps exporters may worsen inflation pressure.
Global markets remained cautious ahead of the Fed and BOJ meetings. Reuters reported that Asian shares struggled as investors weighed Middle East tensions, calls for slower AI development, elevated oil prices and higher bond yields.
South Korea remained an important reference point for Tokyo. Bargain hunting in chip stocks helped the Kospi recover from early losses after a three-session slide. That mattered because overseas investors increasingly treat Japanese chip-equipment makers, South Korean memory producers, Taiwanese foundries and U.S. AI shares as part of one connected global technology trade.
When South Korean memory shares stabilize, Japanese AI and semiconductor-related names often receive support. When Seoul weakens, Tokyo’s chip complex can quickly come under pressure.
The September 15 rebound in SoftBank and Kioxia therefore had regional significance. It suggested that the market was not abandoning AI hardware and infrastructure, even though investors remain more cautious than during the first half of the year.
The broader AI debate remains unresolved. Recent warnings from AI-company leaders about safety and the pace of development have forced investors to consider whether regulation, ethical concerns or technical limits could slow the investment boom.
At the same time, demand for AI infrastructure remains enormous. Data centers require advanced chips, high-bandwidth memory, testing equipment, optical fiber, power systems, cooling, electronic components and software integration. Japan remains deeply exposed to many of these supply-chain layers.
This is why the market is no longer simply bullish or bearish on AI. Investors are separating companies with direct earnings visibility from those whose valuations depend more heavily on long-term expectations, capital-market funding or broad enthusiasm.
Software and systems companies remain part of that shift. Recent U.S. software earnings have encouraged investors to view AI as a tool that can improve productivity and margins rather than only a threat. Japanese names such as NEC, Fujitsu, Nomura Research Institute, Obic and Money Forward remain relevant to that theme.
However, on September 15 the main index support came from the rebound in SoftBank and chip-related shares rather than from a broad software rotation.
Exporters faced a more complicated setting. The yen near 154 remains weak by long-term standards, but stronger than levels earlier in the summer. Automakers, machinery makers and electronics exporters must now adjust to a currency environment that is less favorable than when the dollar was near 160.
Toyota, Honda, machinery companies and precision-equipment makers remain profitable at current exchange rates, but the speed of recent yen moves makes earnings assumptions harder for investors to judge.
Importers, retailers and household-facing companies benefit from the stronger yen, but high oil prices offset some of that advantage. Lower import costs help, but energy and logistics costs remain high when Brent crude is above $100.
Household conditions remain central to the domestic story. July wage data were strong, and revised April-June GDP showed the economy was firmer than first estimated, but consumers continue to face high prices for essentials.
TV Tokyo’s broader business themes remain closely connected to the market. Companies are trying to decide how much of higher labor, fuel, logistics and raw-material costs can be passed on to customers. Households are judging the economy by whether wage gains actually cover daily expenses.
Businesses with pricing power, stable demand, strong brands or exposure to long-term investment remain better positioned. Companies without pricing power remain vulnerable if oil stays high, wages rise further and consumers resist additional price increases.
Banks, insurers, utilities, trading houses and defensive domestic-demand shares remain important alternatives to AI-related stocks. These sectors have helped support TOPIX during periods when the Nikkei has been hit by technology selling.
Banks benefit from higher interest rates, utilities and defensive shares can attract money during volatility, and trading houses offer exposure to commodities, global cash flows and shareholder returns. However, each group has its own risks if yields rise too quickly or energy costs remain high.
The September 15 session showed that the market is trying to stabilize before the week’s policy decisions. The Nikkei did not extend the previous day’s decline, but it also failed to sustain its morning rebound. That suggests investors are still unwilling to take large positions before the Fed and BOJ set the next direction.
What to watch next: whether the Nikkei can hold above 63,000 and return to the 64,000 range, whether TOPIX continues to show relative resilience, and whether SoftBank Group, Kioxia, Advantest and Tokyo Electron can stabilize the AI trade.
The Fed meeting on September 15-16 is the immediate overseas catalyst. A hawkish decision could lift U.S. yields and pressure technology stocks, while a softer tone could support growth shares but strengthen the yen.
The BOJ meeting on September 17-18 is the central domestic event. A 25-basis-point rate hike is widely expected, but the market reaction will depend on Ueda’s guidance for December and 2027.
The yen around 154 to 155 to the dollar remains a key signal. A renewed move toward 160 would revive inflation and intervention concerns, while further strength toward 153 or below would pressure exporters and carry trades.
Oil above $107 remains the largest inflation risk. If crude stays near this level, Japan’s household and corporate cost pressures will intensify even with a stronger yen.
The 10-year JGB yield near 3% will also remain critical. A sustained move above that level could pressure equity valuations and fiscal policy, while a retreat would help risk appetite.
Other key factors will be Middle East shipping risks, South Korean semiconductor shares, U.S. inflation expectations, Japanese fiscal policy and any new comments from BOJ officials.
September 15 showed that Tokyo’s market still has enough support to absorb AI-related shocks, but investors are no longer willing to chase the Nikkei higher before central bank decisions. SoftBank and Kioxia helped steady the index, yet oil, yields, the yen and BOJ guidance will determine whether the rebound can last.
Source: CNBC
