Japan's Nikkei slips to 3-week low on tech sell-off over AI-business outlook

By Junko Fujita TOKYO, Dec 18 (Reuters) - Japan’s Nikkei share average slipped to a three-week low on Thursday, pressured by heavyweight tech stocks as investors weighed the outlook for artificial intelligence and data centre businesses. The Nikkei (.N225) was down 1.4% at 48,830.26, as of 0120 GMT. Earlier in the session, the benchmark touched its lowest point since November 25. The broader Topix (.TOPX) slipped 0.65% to 3,347.51. Wall Street’s main indexes closed lower on Wednesday, with the S&P 500 and the tech-heavy Nasdaq sinking to three-week lows as nagging worries about the artificial intelligence trade weighed on technology stocks. (.N) “The market’s concerns about the profitability of AI-related businesses and data centres in the U.S. have been coming to the surface,” said Kazuaki Shimada, chief strategist at IwaiCosmo Securities. “Japan is not an exception because there are so many data centres being constructed in the country,” he added. SoftBank Group (9984.T) fell 4.5% after Oracle (ORCL.N) dropped 5.4% following a report that said the cloud company’s largest data centre partner Blue Owl Capital (OWL.N) will not back a $10 billion deal for its next facility. Earlier this year, SoftBank Group, along with Oracle and OpenAI, announced plans to develop artificial intelligence data centres in the U.S to build out their ambitious Stargate project. “The Stargate project is the centre of U.S. data centre development, and SoftBank is deeply involved in it,” Shimada said. Chip-related Advantest (6857.T) lost 3.57% and Fujikura, maker of fibre optic cable, fell 3.8%. Financials fell ahead of the Bank of Japan’s policy meeting conclusion on Friday, with investors expecting the central bank to announce an interest rate hike. Shares of Mitsubishi UFJ Financial Group (8306.T) were down 0.67% and Mizuho Financial Group (8411.T) lost 0.57%. Bucking the trend, railway operator Keisei Electric Railway (9009.T) jumped nearly 4% to become the Nikkei’s top percentage gainer. The Topix’s value share index (.TOPXV) fell 0.25%, against a 0.75% fall of the growth share index (.TOPX) .