Nikkei rises 1% as AI and chip stocks climb after BOJ lifts policy rate to 1.25%
Japan's Nikkei rose ~1% as AI and semiconductor stocks outperformed, tracking a tech-led rally in the US. However, the Bank of Japan's rate hike to 1.25% (a 31-year high) tightens financial conditions, typically a headwind for high-valuation growth equities. The mixed Topix performance and breadth suggest the move is sector-driven rather than a broad risk-on shift.
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The Bank of Japan raised its policy rate to a 31-year high of 1.25% to curb the risk of inflation overshooting its 2% target. Japan’s Nikkei 225 advanced 1%, led by AI- and semiconductor-related shares such as SoftBank, Advantest and Tokyo Electron. Gaming stocks lagged, with Nintendo and Konami each down about 2%.