Japan’s Nikkei Stock Average Gains on Weaker Yen; Chip Shares Cheer TSMC Earnings (UPDATE 1)

Reuters

12:17 JST, July 17, 2025 (updated at 16:30 JST)

TOKYO, July 17 (Reuters) – Japan’s Nikkei share average recovered from early losses to end Thursday with solid gains as a weakening yen bolstered sentiment, while chip shares pared declines after Taiwanese chipmaker TSMC posted record earnings.

The Japanese currency sank as much as 0.5% against the U.S. dollar, sliding towards Wednesday’s 3-1/2-month nadir. A weak currency boosts the value of overseas revenues for heavyweight exporters.

Meanwhile, TSMC reported results that topped analyst forecasts during the Tokyo Stock Exchange’s afternoon session. It undid some of the pessimism from Dutch chip-making tool supplier ASML’s ASML.AS revenue warning, which had weighed on Japanese chip shares in the morning.

The tech-heavy Nikkei .N225 ended the day up 0.6% at 39,901.19, reversing earlier declines of as much as 0.7%.

The broader Topix .TOPX rose 0.7%.

Silicon producer Sumco 3436.T was the Nikkei’s biggest percentage gainer with a 7% jump. AI-focused start-up investor SoftBank Group 9984.T was the biggest support in index-point terms with a 2.3% increase.

Heavily weighted chip-testing machinery maker Advantest 6857.T was the Nikkei’s biggest drag after dropping0.8%. Chip-making equipment manufacturer Lasertec 6920.T was another standout loser, with a 4.8% tumble.

ASML warned on Wednesday that it may not achieve revenue growth in 2026 as chipmakers building factories in the U.S. await clarity on the potential impact of tariffs.

For Japanese peers, “quarterly orders are likely to fluctuate but, based on the 12-month moving average, orders have not yet entered a recovery phase, similar to ASML,” Jefferies analysts wrote in a research note on Wednesday.

Orders for extreme ultraviolet lithography equipment, a key component in chipmaking, have been “stalled” since increasing “sharply” in the first half of last year, although a recovery is likely in 2026, they said.

The Nikkei’s biggest decliner in percentage terms was Seven & i Holdings 3382.T, which slumped 9.2% after Canada’s Alimentation Couche-Tard ATD.TOended its takeover bid for the operator of the 7-Eleven convenience store chain.

The worst performer among the 33 Topix industry groupings was the mining sub-index .IMING.T, which includes oil explorers, which sank 1.0% with Brent oil languishing below $70 a barrel this week. The oil and coal sub-index .IPETE.T lost 0.8%.