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Stocks

Autonomous cars becoming stock market driver

Tie-ups come fast and furious to still-unproven field

TOKYO -- Shares linked to autonomous driving are gaining this year as a flurry of collaboration creates a buzz over the technology, but some worry about the dangers of overoptimism.   

DeNA's share price rose 4% Friday on news that the Japanese online game company was partnering with Nissan Motor to commercialize driverless vehicles. Nissan CEO Carlos Ghosn announced the tie-up Thursday at the Consumer Electronics Show in Las Vegas.

Shares in Zenrin went limit-up Thursday afternoon. The jump was spurred by major U.S. chipmaker Nvidia announcing a partnership on artificial intelligence for cars with the Japanese digital mapmaker, as well as others including German autoparts supplier Bosch. On Friday, Zenrin slid 7% as investors locked in their gains.

The stock ended the day up 14.6% from its 2016-end close. Pioneer, another Japanese name in car navigation, was up 12.3%. DeNA stood 6.5% higher than at the end of 2016, while Renesas Electronics, which showed off its automotive chips with a prototype self-driving car at CES, was up 6.3%.

Investor enthusiasm over autonomous vehicles is not confined to the Tokyo market. Israeli tech company Mobileye, which develops vision-based driver assist systems and has a partnership with Intel, has seen its New York-listed shares rise 10% this year.

While self-driving cars are becoming a major theme for investors, some see parallels to the dot-com bubble. "We're entering a period when it will become clear who the winners and losers are in the autonomous-driving field," said an analyst at Sparx Asset Management.

Politics also poses risks to the field. "U.S. President-elect Trump is very concerned about protecting jobs, so he may be less than warm to technology that undermines employment," warned Takatoshi Itoshima of Commons Asset Management.

Moreover, legal issues surrounding responsibility for self-driving car accidents still need to be sorted out. If obstacles to driverless technology do not come down, it may stall as a stock market driver.

(Nikkei)

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