Japan’s Chip Shares Sink as DeepSeek Triggers Competition Fear #JapanFinance

(Bloomberg) — Japan’s chip-related shares including Advantest Corp. tumbled as Chinese AI startup DeepSeek gained traction, raising concern the app will threaten US’s technological leadership.

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Nvidia Corp. tester supplier Advantest fell 8.2%, while Disco Corp. slid 2.9%. Tech and chip-related shares were vulnerable to profit taking Monday after surging last week on SoftBank Group Corp.’s plan to team up with companies including OpenAI and Oracle Corp. to invest in AI infrastructure in the US.

SoftBank Group, which soared 16% last week, fell 5.4%, while Furukawa Electric Co. and Fujikura Ltd., which make cables for data centers, weakened by at least 8%.

“Big tech companies have spent a fortune on AI, almost to the scale of a government budget, but there’s been a question around whether there will be returns that match their size of investments,” said Masayuki Murata, general manager of balanced portfolio investment at Sumitomo Life Insurance Co. DeepSeek is likely triggering losses in tech shares, he said.

The drop in Japanese tech shares follows declines in Nasdaq futures amid concerns over DeepSeek, which unveiled an updated AI model last week that it says is competitive with OpenAI’s technology.

“This is all DeepSeek issues so far today, but it is very hard to tell how impactful things really are from this,” said Andrew Jackson, head of Japan equity strategy at Ortus Advisors Pte. “It’s very clear that anything that’s overheated like Fujikura and Furukawa are getting the wind knocked out of them.”

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