The Japanese stock market is experiencing massive sell-offs by foreign funds, and investors are hastily clearing their positions in technology stocks.

As of the week ending June 27, overseas investors sold Japanese stocks at the fastest rate in about three months in order to profit from the soaring valuations of technology stocks after a significant increase in stock prices last quarter. There is also increasing concern about AI spending funded through debt. Data released by the Japanese Ministry of Finance on Thursday showed that non-domestic investors withdrew a net amount of 1.82 trillion yen from the Japanese stock market in that week, the largest weekly net selling amount since March 28. The Nikkei 225 index rose by a total of 37.21% last quarter, causing investors to take profit by selling high-growth technology stocks last week. Meanwhile, foreign investors have been net sellers of Japanese long-term government bonds for the fourth consecutive week, with a total outflow of 493.7 billion yen; they also sold 2.43 trillion yen of short-term government bonds.