Foreign investment has flocked to the Japanese stock market for eight consecutive weeks! Net inflows exceeded 1 trillion yen in a single week, with AI chips and semiconductor equipment leading the AI frenzy in Tokyo.

The latest statistical data shows that as of the week ending on May 23, foreign investors have been buying Japanese stocks in large quantities for eight consecutive weeks. This is mainly due to the significant drop in oil and natural gas prices, as well as the positive outlook driven by the increasing demand for AI computing power, which is closely related to AI chip stocks that have a high weight in the benchmark Nikkei 225 index and are gaining momentum. This has pushed the trading prices of these AI computing power-related assets towards a continuous upward trajectory. Companies like SoftBank, Socionext, Advantest, Tokyo Electron, Lasertec, and Cisco Systems, Inc. collectively hold a high weight in the Nikkei 225 index and are popular stocks in the AI chip and semiconductor equipment sector. They are considered the most important narrative axis driving the large-scale inflow of foreign capital into the Japanese stock market in recent weeks, as well as the core contributing weight behind the strong growth of the Nikkei 225 index. The latest financial report from NVIDIA Corporation confirms the extremely strong demand for underlying AI computing power: its quarterly revenue increased by 85% year-on-year to US$81.62 billion, with data center revenue nearly doubling to US$75.2 billion. NVIDIA Corporation's GPU demand for AI set a record overflow, leading to a reassessment of the AI computing power industry chain. Foreign investors have been buying Japanese stocks in large quantities for eight consecutive weeks, with SoftBank and various semiconductor equipment stocks fueling a bullish trend. Foreign investors have been net buyers of Japanese stocks by approximately 1.08 trillion yen (about $67.7 billion) in the week ending on May 23, a significant increase of nearly 14% compared to the previous week. The semiconductor sector has attracted the largest inflow of foreign funds, mainly because NVIDIA Corporation's CEO, Jensen Huang, predicted last week that the demand for its flagship AI chips has never been stronger, calling AI data center construction the "largest infrastructure expansion in human history." AI chip and semiconductor equipment giants have sparked a trading frenzy on the Tokyo Stock Exchange under the influence of the AI faith. The semiconductor equipment sector is seen as one of the biggest winners under the explosion of AI computing and storage demand. In conclusion, the AI computing infrastructure is entering a more lasting and broader capital expenditure cycle, as seen from the different perspectives of financial institutions. The AI computing power trading theme will continue to drive technology stocks into bullish territory, with the semiconductor equipment sector playing a crucial role in the AI hardware industry chain. SoftBank, by having made large investments in companies like Arm Holdings plc and OpenAI, aims to become the leading provider of AI computing power and application layer infrastructure in the next decade. Overall, the AI computing power investment theme will shift from competition around GPU/AI ASIC to a full-stack algorithm power system driven by AI agents. This will lead to the next round of excess alpha returns not only in AI GPU/AI ASIC, but also in high-performance CPUs, data centers, and other components in the AI computing power infrastructure layer.