Japanese Stocks Fall as Investors Await Key US Chip Earnings

2026-09-28 economy

Tokyo, Monday, 28 September 2026.
Japan’s Nikkei index surrendered early 1% gains on Monday as falling US technology futures and anticipation surrounding Micron Technology’s upcoming quarterly earnings report prompted cautious profit-taking.

Market Reversal and Semiconductor Sensitivity

Japan’s benchmark Nikkei share average reversed early morning advances to trade lower on Monday, driven by broader market caution and falling Nasdaq futures ahead of upcoming earnings results from U.S. semiconductor giant Micron Technology Inc. [1][2]. The Nikkei ended the morning session 0.05% lower at 66,333.53, after climbing as much as 1% earlier to 67,034.74, its highest level since mid-August [5]. This intraday volatility represents a -1.046 decline from the session high, highlighting the fragility of investor sentiment [5]. The cautious trading sentiment underscores global equity market sensitivity to semiconductor demand and tech valuations, as leadership in major international indices remains tightly coupled to performance metrics across the global AI hardware supply chain [1].

Micron Earnings as a Barometer for AI Demand

Investors sold shares due to weakening Nasdaq futures during Asian trading hours and position rebalancing ahead of the half-year end [2]. Micron Technology’s quarterly earnings report is scheduled for Wednesday, 2026-09-30, serving as a critical proxy for broad AI-sector demand [3][6]. Analysts anticipate Micron will report earnings per share of $31.49 on revenue of $50.9 billion, with the Zacks Consensus Estimate for revenue at $50.86 billion [3][6]. Revenue growth is driven by demand for high-bandwidth memory (HBM) and memory chips for GPU-enabled artificial intelligence (AI) servers, alongside improving supply-demand dynamics for DRAM and NAND chips [6]. Bank of America analysts report hyperscalers have agreed to higher memory prices for H1 2027 versus Q4 2026, though models suggest memory pricing could decline over 10% in calendar 2028 [3].

Broader Economic Indicators and Policy Context

Wall Street enters the week ahead watching two labor and inflation reports that will shape Federal Reserve rate expectations, plus the Micron results [3]. Economic data releases for the week of September 28, 2026, include the JOLTS report (September 29, 2026), ADP private hiring data (September 30, 2026), and nonfarm payrolls (October 2, 2026) [3]. The August Personal Consumption Expenditures (PCE) price index, scheduled for release on September 30, 2026, is projected to rise 0.4% month-over-month [3]. In Japan, services producer prices rose 3.7% in August 2026, the fastest pace in over two years, adding complexity to the Bank of Japan’s policy outlook [2]. Bank shares face long-term risk of losing support as the Bank of Japan (BOJ) policy rate approaches its terminal level [2][5].

Trading Range Outlook and Sector Performance

The US semiconductor index has traded within a box range since 2026-06-20, and analysts anticipate it will remain within a wide trading range for the next three to four months [2]. A senior portfolio manager at a Japanese asset manager noted that the Nikkei is likely to track those moves, expecting the index to stay inside the range for the next three to four months [2]. While technology stocks faced pressure, banking stocks supported the broader market, with Mitsubishi UFJ Financial Group rising 0.24% and Sumitomo Mitsui Financial Group advancing 1.27% [5]. The Nikkei Stock Average projected range for the week of September 28–October 4 is 64,000–68,500 yen, reflecting the current equilibrium between rising interest rates and AI earnings growth expectations [4].

Sources

Semiconductors Financial Markets