Nikkei 225 Plunges 3.9% as AI Trade Reversal Erases Record-Run Gains

Japan's Nikkei 225 suffered its steepest single-day drop since March 9, falling 3.9% on June 8 as the AI-driven rally that had propelled the index to successive record highs abruptly reversed. The selloff was triggered by a Nasdaq 100 decline of roughly 5% and a 10% plunge in the Philadelphia Semiconductor Index, with SoftBank, Kioxia, and Murata each shedding more than 10% intraday. The reversal follows a blistering run that saw the Nikkei clear 67,000 on June 1 — when SoftBank overtook Toyota as Japan's most valuable company — and then breach 68,000 on June 3, with the index up approximately 36% year-to-date at its peak. Analysts warn the correction may extend if higher-for-longer Fed expectations and renewed Middle East tensions persist.