[Good Morning Stock Market] Concerns Over Global Resurgence of COVID-19... Impact on Domestic Stock Market?

On the 26th, when the KOSPI index started rising after a sharp drop of over 2% the previous day, dealers were working in the dealing room of Hana Bank in Euljiro, Seoul. Photo by Moon Honam munonam@

[Asia Economy Reporter Park Jihwan] Signs of a resurgence of the novel coronavirus infection (COVID-19) are growing not only domestically but also overseas. Recently, as COVID-19 has started spreading again in the United States, it has been found that only 2 out of the 50 states are seeing a decrease in new cases. In particular, some states are preparing to strengthen economic shutdowns again due to the rapid increase in new infections, drawing attention to how much this will affect investor sentiment.

◆ Seo Sangyoung, Kiwoom Securities Researcher = The domestic stock market is expected to see selling pressure as uncertainty rises due to the resurgence of COVID-19 in the U.S. Especially, the announcement by some state governments to strengthen economic shutdowns has increased concerns, which is a burden. There are many factors that could stimulate volatility, such as the U.S.-China trade dispute and economic uncertainty.

This week, there are many important issues including Korea's export and import data, manufacturing indices from the U.S. and China, U.S. employment figures, Micron's earnings announcement, and a speech by Fed Chair Powell, so this increased volatility is expected to continue daily. In particular, based on recently released key economic indicators, they are expected to fall short of forecasts. Additionally, as Fed Chair Powell mentioned on the 19th, he is expected to discuss economic outlook uncertainties, which is also likely to have a negative impact.

Of course, if the indicators exceed expectations, despite the spread of COVID-19, a counter-buying trend may emerge, so the results of these indicators are ultimately expected to drive index changes this week.

◆ Lee Sang, Hi Investment & Securities Researcher = Recently, the momentum of the global stock market's rise has somewhat stalled. The reasons are the resurgence of COVID-19 in the U.S. and the U.S. imposing tariffs on the EU. Among these, the resurgence of COVID-19 in the U.S. is the biggest concern.

Recently, the number of new COVID-19 cases in the U.S. has surged again to previous peak levels, raising concerns. Especially, the spread is severe in southern regions including California, Texas, and Florida. However, despite the recent weakening momentum in the stock market, the possibility of a major financial market crash like at the early stage of the COVID-19 spread is expected to be low.

This content was produced with the assistance of AI translation services.