By Kevin Buckland
TOKYO, June 1 (Reuters) - Japan's Nikkei share average topped 67,000 for the first time on Monday, powered by AI-related shares, as startup investor SoftBank Group overtook Toyota Motor to become the country's most valuable company.
The Nikkei climbed 1.1% to enter the midday recess at 67,038.24, after pushing as high as 67,231.28.
SoftBank was by far the biggest support for the index, jumping 10.3% to contribute 618 points of the Nikkei's total 709-point rise.
The company's market
capitalisation swelled to around 47.2 trillion yen ($296.0 billion), while Toyota's shrank to around 45.7 trillion yen after the stock slid 4.8% on Monday.
Over the weekend, SoftBank pledged some 75 billion euros ($87.3 billion) over five years to build up AI infrastructure in France.
The split between tech shares and the rest of the market was clear from the performance of the broader Topix, which sagged 0.2%.
Both the Nikkei and Topix had notched all-time highs on Friday on optimism over a near-term peace deal in the Middle East, but the fresh week began with Washington and Tehran still appearing to differ on significant issues.
"Given the current expectations for expanding demand for AI servers, buying interest is spreading to AI-related stocks that had been lagging behind," such as electronic component maker Murata Manufacturing, said Maki Sawada, a strategist at Nomura Securities.
Shares of Murata surged 14.1% to be the Nikkei's biggest percentage risers.
At the same time, "we're in a situation where concerns about overvaluation are deep-rooted," particularly with uncertainty around the Middle East still high, she said.
Among the Tokyo Stock Exchange's 33 industry groups, eight rose, led by a 4.3% jump in IT firms. Auto shares were among the worst performers, down 4.2%.
Even in the Nikkei, only 73 of its 225 components rose, versus 152 that fell.
Not all chip-related shares advanced, with Advantest retreating 2.2% and Fujikura down 3.6%.
Mitsubishi Motors was the biggest percentage decliner, tumbling 9.1%. Alliance partner Nissan was another standout loser, declining 7.2%.
($1 = 159.4700 yen)
($1 = 0.8588 euros)
(Reporting by Kevin Buckland; Editing by Sherry Jacob-Phillips)
