Nikkei falls as much as 3% as AI spending concerns hit chip stocks
Advantest and Tokyo Electron led the decline, while Japan's broader Topix fell 1.3% ahead of the Bank of Japan's policy decision.
Dollar slips with Treasury yields as yen awaits BOJ decision
U.S. bond yields hit their lowest in more than a month, while markets put the probability of a December rate increase in Japan at about 80%.
U.S. Treasury yields reached their lowest levels in more than a month on October 30, accompanying a softer dollar as investors sold AI shares. The yen was little changed ahead of a Bank of Japan decision widely expected to leave its policy rate at 1.25%.
The dollar index eased to 101.77, though it remained headed for a second consecutive monthly increase, with an October gain of 0.3%. The 10-year Treasury note yielded 4.8958%, while the yield on 30-year bonds dropped to 5.2623%.
Alphabet's results had renewed concerns about AI spending, prompting a retreat from equities and demand for government debt. OCBC FX strategist Sim Moh Siong said the response differed from an energy-driven shift away from risk: U.S.-centered AI worries coincided with falling Treasury yields and a weaker or subdued dollar.
Japan's currency edged down to around 157.815 per dollar, leaving it headed for a monthly loss of 0.2%. Markets assigned roughly an 80% probability to a December rate increase. The European Central Bank, the U.S. Federal Reserve and the Reserve Bank of New Zealand had already held rates steady.
The euro traded unchanged at $1.1185, on course for a 1.2% October decline. Sterling rose 0.1% to $1.3390, taking its monthly advance to 1%. Brent crude futures were heading for an 11.5% monthly gain, extending their run of increases to a fourth month.