The Concentration in AI/Semiconductors and the Strength of Kioxia Behind the Nikkei 225’s +2,203 Yen Gain1. Conclusion for This WeekWhy Did the Nikkei 225 Rise Significantly Even Though Interest Rates Rose?The most impressive aspect of this week’s market was that, despite the strong headwind of rising interest rates, capital actually flowed into AI and semiconductor-related stocks.The U.S. 10-year Treasury yield rose to as high as 5.34%, reaching its highest level since 2002. Japan’s 10-year government bond yield also rose by 42bp in the July-September quarter, the largest increase in over 20 years. Normally, this is a difficult environment for stocks, especially those with high growth expectations. ReutersReutersIn reality, not all sectors were strong. While interest rates and rising crude oil prices are burdens on the global market, the bias where a few large-cap AI-related stocks support the index continues. ReutersNevertheless, in the Japanese stock market, the Nikkei 225 rose by 1,272 yen on September 30, and by another 2,203 yen, or 3.30%, on October 1. Rather than a broad-based rally, it was a market where capital was strongly concentrated in AI and semiconductors.Kioxia was symbolic. If it were just easier to buy due to the 3-for-1 split, it would not be surprising if the news had been fully priced in after the ex-rights date. However, active trading continued even after that.Moreover, it was not just Kioxia that was strong.The eMAXIS Nikkei Semiconductor Stock Index recovered sharply from a level that had briefly fallen below 20,000 yen, reaching 23,246 yen on October 1, up 5.54% from the previous day. And even on October 2, when the Nikkei 225 fell by 647 yen, it remained in positive territory at 23,252 yen, up 6 yen (+0.03%).It feels like viewing this week simply as a “week where the location of capital changed” is not quite enough.Global equity funds also saw an inflow of $34.76 billion in the last week, meaning new capital was also entering the stock market as a whole. ReutersWas new capital added to the funds that moved from other sectors?So, why were AI and semiconductors chosen as the receptacle for that capital?2. Facts, Evidence, Impact, Risks, and Future Outlook2-1. Facts | Even Amid the Headwind of Rising Interest Rates, Capital Gathered in SemiconductorsThis week, long-term interest rates rose in both Japan and the U.S., making it a difficult environment for the stock market as a whole. The U.S. 10-year Treasury yield rose to as high as 5.34%, the highest level in 24 years, and rising interest rates spread across global bond markets as well. ReutersNevertheless, in the Japanese stock market, the Nikkei 225 rose significantly by +1,272 yen on September 30, and by another +2,203 yen, or +3.30%, on October 1.However, on October 1, the Nikkei 225 saw 108 stocks rise and 115 stocks fall. On a day when the index rose by more than 3%, there were more declining stocks, making it a quite skewed rally.What becomes clear here is that rather than “the entire Japanese stock market being strong,” it was a market where capital was concentrated in a few high-priced stocks and AI/semiconductor-related issues.Top 5/Worst 5 Contributors to the Nikkei 225 This WeekPeriod: September 28 to October 2, 2026 | 5-Day Cumulative TotalTop 10 Trading Value This WeekPeriod: September 28 to October 2, 2026 | Excluding ETFs, 5-Day TotalIn terms of contribution, Advantest pushed the Nikkei 225 up by approximately 1,006 yen for the week, while Kioxia recorded approximately 4.23 trillion yen in trading value over the five days.The extent to which this week’s capital concentrated on AI and semiconductors is evident from both the impact on the index and actual trading activity.2-2. Rationale | Capital Flowed into Semiconductors Because Strong Figures Were Also Emerging from the Industry SideBehind the flow of capital into semiconductors was not just thematic appeal, but figures indicating the strength of the industry itself.Driven by strong demand for AI-related memory, Micron projected next-quarter revenue at $61.5 billion, exceeding the market consensus of approximately $57 billion.Customer commitments, such as long-term contracts, have also increased to $32 billion, meaning AI infrastructure investment is translating into actual orders.ReutersIn South Korea, semiconductor exports in September expanded by 262.8% year-on-year to $60.3 billion. The strength of demand for AI and data centers appeared not just in stock prices, but in export statistics as well.ReutersIn other words, this week, there was not only the expectation that “it was bought because it is AI-related”, but also the backing that demand is actually emerging for memory, servers, and data centers.This is considered one of the major reasons why capital remained in semiconductors despite the headwind of rising interest rates.2-3. Impact | Possibility of Not Just Capital Rotation, but New Capital InflowThis is where the market this week gets most interesting.Rising interest rates put selling pressure on many sectors and stocks. It is possible that some of the capital that exited those areas moved into AI and semiconductors, where earnings expectations are strong.However, that alone does not fully explain the situation.According to global fund flow data released on October 2, global equity funds saw an inflow of $34.76 billion, marking the second consecutive week of net inflows. US equity funds alone saw an inflow of $20.6 billion, with $6.19 billion into Europe and $6.16 billion into Asia.ReutersIn other words, this week, it is possible that capital shifting from other sectors was compounded by new capital flowing into the stock market itself.Of course, it cannot be directly confirmed that these funds went straight into Japanese semiconductor stocks.However, considering that semiconductor-related stocks with high index contribution rose significantly and trading volume surged, it is highly plausible that AI and semiconductors were chosen as a destination for new capital, rather than just simple inter-sector rotation.2-4. Risk | Strong Capital Concentration Also Makes the Market UnstableAnother point to keep in mind when looking at this week’s strength is the risk of capital concentration.On October 1st, while the Nikkei 225 rose by 3.30%, there were actually more declining stocks than advancing ones.In other words, while the force pushing up the index was strong, the gains were not spreading across the entire market.Furthermore, globally, while capital is flowing into equity funds, a $2.63 billion outflow has been confirmed from technology sector funds. ReutersJust because AI and semiconductors are strong does not mean that investors around the world are buying technology unconditionally.If capital concentrates in a few stocks, the impact during a rise becomes significant. Conversely, if profit-taking begins, the same mechanism works in the opposite direction.The significant pullback of the Nikkei 225 on October 2nd this week already demonstrates that instability.2-5. Future Outlook | What to Watch Next: Not the Upside, but Whether ‘Capital Remains’What I want to confirm from next week onwards is not just whether the Nikkei 225 will rise further.Rather, whether trading volume remains on days when semiconductors fall, whether buying comes in on dips, and whether advancing stocks spread beyond semiconductors. These three points are more important.In particular, if capital remains in semiconductors even as interest rates continue to rise, the likelihood increases that this week’s strength was not merely a short-term event-driven market.Conversely, if trading volume begins to thin out while stock prices remain high, we must also consider the possibility that short-term capital has finished its cycle following this week’s surge.This week, the significance lay not in the fact that semiconductor stocks rose, but in the fact that capital continued to gather even in the face of headwinds.Next week will likely be a week to determine whether that capital was transient or if it will establish itself as the center of a new market trend.3. Charts4. Technical, Fundamental, and Macro Analysis4-1. Technical | Looking at ‘Concentration Strength’ Rather Than Index StrengthThe Nikkei 225 surged from the end of September through October 1st this week, but saw a significant pullback on October 2nd. While the price action alone looks very volatile, the characteristic of this move is that the index as a whole was not uniformly strong.On October 1st, while the Nikkei 225 rose by 3.30%, there were 108 advancing stocks and 115 declining stocks in the Nikkei 225. The breadth of the market was weak relative to the index’s rise, and concentration in high-priced stocks was quite strong.Looking at the semiconductor side, the Nikkei Semiconductor Stock Index on October 2nd was 26,342.92, down 0.52% from the previous day. On the day the Nikkei 225 fell significantly, the decline in the semiconductor index remained relatively small. Nikkei Inc.Also, the eMAXIS Nikkei Semiconductor Stock Index fell to 19,898 yen on September 17, but has since recovered to 23,252 yen as of October 2. This is a rebound of approximately 17% from the low. Yahoo! FinanceWhat I want to check technically next week is not the renewal of the high itself. Whether dip-buying enters while maintaining volume and trading value on days when the price falls. This seems to be the point for gauging the sustainability of this current rise.4-2. Fundamentals | Semiconductor demand figures are strengthening ahead of stock pricesThe biggest factor supporting the rise in semiconductor stocks is that AI demand is no longer just an expectation, but is beginning to appear in corporate earnings and trade statistics.Micron projected revenue for the next quarter at $61.5 billion, significantly exceeding the market forecast of approximately $57 billion. Furthermore, customer commitments such as long-term contracts have increased to $32 billion, and remaining performance obligations have risen to $150 billion. ReutersIn South Korea, semiconductor exports in September also surged, up 262.8% year-on-year to $60.3 billion. ReutersWhat is important is that the benefits of AI investment are no longer limited to GPUs.As bottlenecks spread to memory, inspection equipment, manufacturing equipment, optical communications, servers, and power facilities, multiple semiconductor-related companies in Japanese stocks are also becoming recipients of capital.Kioxia is one of them. While it is thought that there is an effect of it becoming easier to buy due to the 3-for-1 split, if it were just a split, it would not be strange for the material to be exhausted after the ex-rights date.Even so, I believe that the background to the continued trading is largely due to the continued expectations for the industry itself, including NAND and memory for data centers.In other words, it is more natural to consider this rise as a market where the individual material of a stock split and the industry fundamentals of AI and memory demand overlapped.4-3. Macro | A tailwind for semiconductors, but a strong headwind for the financial environmentThis is the most interesting part of this week. Looking only at the fundamentals, there is a tailwind for AI and semiconductors.However, the macro environment is actually the opposite. The U.S. 10-year Treasury yield temporarily rose to 5.34% on October 1, reaching its highest level since 2002. Not only in the United States, but also in Japan, the UK, France, and elsewhere, government bond yields have risen, and borrowing costs are increasing globally. ReutersFurthermore, crude oil has also risen significantly since the end of September. On October 1, crude oil prices rose by over $4 in a single day following reports on the Middle East situation and China’s fuel export ban. ReutersRising interest rates and high crude oil prices increase corporate financing costs and inflation concerns.Normally, this is a very difficult combination for growth stocks, where expectations for future profits are high.Even so, capital remained in semiconductor stocks this week. This is important when considering this market. It did not rise because the financial environment was good, but rather, sectors with strong earnings expectations were selected even while the financial environment was bad.If we look at the strength of semiconductor stocks this week, this is the point I want to emphasize the most.However, there is a condition for this state to continue. It is that the growth in AI demand must continue to outweigh the higher financing costs and the compression of corporate valuations.Fundamentals are strong. Capital concentration is also visible in the technicals. However, the macro environment is a headwind.The current semiconductor market is likely experiencing both strength and high volatility precisely because these three factors coexist.5. Notable Market Events6. Future RisksWill the strength that withstood rising interest rates continue?AI and semiconductor stocks showed strength this week despite the headwind of rising interest rates. That is why, from next week onward, rather than asking “will it go up further,” we need to confirm whether the conditions that supported this strength remain.The most significant factor is long-term interest rates. The U.S. 10-year Treasury yield rose to as high as 5.34%, reaching a 24-year high. Reuters also points out that high interest rates and reliance on AI investment will be a major test for U.S. stocks going forward. ReutersIf interest rates rise further, it will burden not only the financing costs of AI-related companies but also the valuation of stocks themselves. They held up this week, but that does not mean it will continue indefinitely.The next thing to watch is the reversal of capital concentration. Global equity funds saw inflows for two consecutive weeks, but in the same week, there was a $2.63 billion outflow from technology sector funds. ReutersIn other words, while expectations for AI and semiconductors remain strong, profit-taking and risk-aversion moves have already begun.In the Japanese market, the rise in the Nikkei Stock Average was further skewed toward a few high-priced stocks. In such a market, when capital begins to exit semiconductor-related stocks, the impact on the index as a whole will be significant.Another point to be cautious about is a dulling reaction to positive news. If stock prices stop rising even when news about strong semiconductor demand or AI investment is released, it is possible that the market has already priced in growth quite far into the future.Going forward, I particularly want to watch these three points: will they rise even on good earnings?will there be buying on days when they fall?will trading volume be maintained?The same applies to Kioxia. Trading remained active even after the 3-for-1 split, and the strength continued after the ex-rights date. However, whether the rise continues will depend less on the split effect and more on demand for NAND and AI-related memory, and whether a wide range of buyers, from large to small, remain.We have confirmed the strength this week. However, precisely because it was strong, we are now entering the stage of watching “where the buying stops”.7. SummaryWhat we saw this week was not just that “semiconductors went up”This week, long-term interest rates rose in both the U.S. and Japan, which was by no means an easy environment for the stock market. Nevertheless, the Nikkei Stock Average rose by 1,272 yen on September 30 and 2,203 yen on October 1.Moreover, looking at the details, it was not a broad-based rally. The index was pushed up significantly by the concentration of capital in a few high-priced stocks, particularly those related to AI and semiconductors.Behind this are not just expectations for AI demand, but actual figures such as memory, semiconductor exports, and data center investment.Trading continued even after Kioxia passed the three-way split event, and the eMAXIS Nikkei Semiconductor Stock Index recovered from a temporary dip below 20,000 yen to 23,252 yen.Looking at this, it feels a bit difficult to explain this week’s movements solely through simple ‘capital rotation between sectors’.New capital has also entered global equity funds, and it is possible that some of it headed toward sectors with strong growth expectations. However, we have not been able to confirm exactly how much new capital specifically entered Japanese semiconductor stocks.Therefore, what I want to convey in this article is not ‘semiconductors are strong, so you should just buy them’ .What you should look at is where capital remained even in the face of the headwind of rising interest rates.From next week onward, rather than just looking at the Nikkei Average figures, if you look at semiconductor trading valuebuying on down daysthe breadth of rising stocks together, it becomes easier to see whether the current market is just a short-term concentration of capital or if it will lead to a new upward phase.This week, capital did not flee even though interest rates rose. The next thing I want to confirm is whether that capital will remain next week.Thank you for staying with me until the end today.If you found today’s article helpful, I would appreciate it if you could give it a like or follow. 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