[Good Morning Stock Market] US Stocks Rebound Centered on Tech Despite Jackson Hole Concerns... Will a KOSPI Uptrend Follow?

[Image source=Reuters Yonhap News]

[Asia Economy Reporter Myunghwan Lee] On the 26th, the domestic stock market is expected to show a favorable trend after starting higher, driven by the rebound in the U.S. stock market centered on semiconductor and technology stocks and the effects of China's economic stimulus measures.

On the 25th (local time), the Dow Jones Industrial Average closed at 33,291.78, up 0.98% (322.55 points) from the previous trading day in the New York stock market. The Standard & Poor's (S&P) 500 index rose 1.41% (58.35 points) to 4,199.12, and the tech-heavy Nasdaq index closed at 12,639.27, up 1.67% (207.74 points).

The Philadelphia Semiconductor Index, which greatly influences domestic semiconductor stocks, closed at 2,971.07, up 3.66% (104.88 points) from the previous trading day. Nvidia, which announced earnings below market expectations after the previous day's close, rose more than 4% on hopes that next quarter's earnings might be the bottom.

The strong U.S. economic indicators released that day also contributed to the index rise. The preliminary real Gross Domestic Product (GDP) growth rate for the U.S. in the second quarter (April to June) was -0.6%, better than the previously released flash estimate of -0.9%. The number of weekly new unemployment insurance claims in the U.S. also decreased by 2,000 from the previous week to 243,000, marking a decline for two consecutive weeks.

Sangyoung Seo, Head of Media Content at Mirae Asset Securities
"Strong U.S. tech stocks and favorable Chinese stimulus... Jackson Hole likely to show a wait-and-see stance"

On the 26th, the domestic stock market is expected to start with a rise of around 0.5%, then show a strong wait-and-see stance as it awaits the results of the Jackson Hole meeting, with fluctuations depending on individual stock issues.

The U.S. stock market's strength in tech stocks amid falling Treasury yields ahead of the Jackson Hole meeting is favorable for the Korean stock market. In particular, despite Nvidia's downward guidance revision, the expectation of a bottoming out boosted sentiment, leading the Philadelphia Semiconductor Index to rise 3.66%, which is expected to drive strength in related sectors in the Korean market.

The Chinese government's announcement of additional economic stimulus policies following those at the end of June has raised expectations for China's economy in the second half of the year, which is also favorable. This is because it raises expectations for increased exports from Korean companies to China, potentially turning the downwardly revised earnings estimates for KOSPI companies into a more solid outlook. Additionally, the easing of delisting issues for Chinese companies and the reduced concerns over U.S.-China conflicts could positively influence overall investor sentiment.

Jiyoung Han, Researcher at Kiwoom Securities "Foreign demand and semiconductors are favorable... Caution needed for volatility in 'Taejo Ibangwon' stocks"

On the 26th, the domestic stock market is expected to show a favorable price trend, supported by foreign investors' favorable demand amid expectations of resolving the overshooting of the weak Korean won and the strong performance of the U.S. Philadelphia Semiconductor Index. However, the wait-and-see sentiment regarding the Jackson Hole meeting is expected to deepen.

Regarding the 'Taejo Ibangwon' theme (solar power, shipbuilding, secondary batteries, defense, nuclear power), which has recently emerged as a major sector of market interest, rapid rotation is occurring within the theme due to disputes among market participants over leading stocks. On the 26th, stock price volatility should be carefully monitored as funds may frequently move in response to related news, such as Korea Hydro & Nuclear Power's large-scale order in Egypt.

Although the Jackson Hole caution since last week has indeed increased market bets on inflation beneficiaries in both the Korean and U.S. stock markets, considering the above, a strategy to increase the weighting of inflation victims rather than further increasing exposure to inflation beneficiaries is also worth considering. Given that the inflation peak appears likely, it is appropriate to assume a base path of a 0.5 percentage point increase in the U.S. benchmark interest rate and to adjust the path after confirming the August U.S. Consumer Price Index (CPI) results scheduled for the 13th of next month.

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