Nikkei Sinks Below 66,000 as Semiconductor Stocks Drag

The Nikkei Stock Average plummeted for a second consecutive day on the Tokyo stock market on February 19th. The selloff was triggered by the previous day's decline in U.S. equities, particularly among semiconductor names. This led to selling in AI and semiconductor-related stocks in Tokyo.

The Nikkei broke below the psychologically important 66,000 level shortly after the open, briefly touching the 65,300 range. This represented a decline of over 2,100 yen from the previous day's close. The index had opened at 66,812.27, down 648.46 yen from the previous close.

Uncertainty surrounding the Middle East situation was a major contributor to the selling pressure. The Philadelphia Semiconductor Index (SOX) fell nearly 5% in the U.S. market on February 18th. U.S. President Trump's statement that 'there are no ongoing or planned negotiations or talks with Iran' and Iran's hardline stance toward the United States further fueled risk-averse selling.

Rising global interest rates also weighed on equities, with U.S. 30-year Treasury yields briefly hitting 5.33%, a 19-year high. Japan's long-term interest rates rose to 2.945% on February 18th, a level not seen in roughly 30 years. In Europe, government bond yields trended upward, prompting selling driven by valuation concerns, particularly in high-PER tech stocks.

Among individual names, declines were notable among semiconductor-related stocks, including Advantest, SoftBank Group (SBG), and Kioxia. On the other hand, Recruit and Otsuka Holdings gained, while Konami Group, Bandai Namco Holdings, and Mercari also rose.