Japan’s Nikkei 225 climbed as chip stocks followed their US peers higher after Friday’s rally. Gains on the broader Topix were smaller as concerns about the yen and bond yields limited risk appetite. Chip-gear makers Kioxia Holdings Corp., Ibiden Co., and Lasertec Corp. were among the Nikkei’s best performers, along with Open AI investor Softbank Group Corp. The gains came after the closely-watched SOX Index rose 3.4% on Friday. “The Nikkei is feeling a considerable tailwind from the strength of the SOX,” said Hiroshi Namioka, chief strategist at T&D Asset Management.

The tech sector is drawing buying despite hotter-than-expected US jobs data fueling more worries about rate hikes, as many shares look attractive after their recent drawdown, he said. “The sense that chip stocks are overvalued is fading now that their prices have come down from the previous rally,” Namioka said. Chat GPT maker Open AI announced the rollout of its new Astra model on Friday, delivering a boost to AI-related shares in the US. South Korean chipmakers SK Hynix Inc. and Samsung Electronics Co. also climbed.

Gains on the broader Topix were more muted, with declines in banks and services weighing on the gauge. Uncertainty surrounding the yen’s trajectory and elevated bond yields is likely to keep investors on high alert until the Bank of Japan’s policy meeting next week, said Namioka. Financial shares may be particularly difficult to buy ahead of BOJ board member Kazuyuki Masu’s remarks, expected on Thursday in Tokyo, he added.