[Good Morning Stock Market] Jackson Hole Shock, Attempting a Rebound in One Day?

US Stock Market Ends Lower Amid Jackson Hole Impact and 4% Surge in International Oil Prices
"Focus on Powell Fed Chair's 'Hawkish' Remarks Not Being New"

"Korean Stock Market Overly Declined... Expected to Rebound"

[Asia Economy Reporter Ji Yeon-jin] The US stock market closed lower on the 29th (local time) as international oil prices surged amid hawkish aftershocks from the Jackson Hole meeting, showing weakness mainly in large tech stocks. The Dow Jones Industrial Average and the Standard & Poor's (S&P) 500 index fell by 0.57% and 0.67%, respectively, while the Nasdaq index recorded a 1.02% decline. However, since the domestic market experienced an exaggerated drop due to the Jackson Hole shock the previous day and the energy sector showed strength in the US market due to rising international oil prices, it is expected to start higher.

◆ Seo Sang-young, Researcher at Mirae Asset Securities = Although the US stock market still declined as it digested remarks from Jerome Powell, Chairman of the Federal Reserve (Fed), the reduced magnitude of the drop is expected to have a positive impact on the Korean stock market. In particular, considering that the possibility of production cuts by the Organization of the Petroleum Exporting Countries Plus (OPEC+) countries has emerged and international oil prices have risen sharply, leading to strength in the energy sectors in the US and Europe, related stocks are expected to drive gains in the Korean stock market as well. Furthermore, with the increased possibility of easing US-China tensions and the fact that the decline in tech stocks, which had a large drop last Friday, has narrowed or some have successfully turned to gains, the Korean stock market is expected to start with an increase of around 0.5%, centered on energy and tech stocks, and maintain strength.

It is important to note that Chairman Powell’s remarks are not new but rather consistent with what many Fed officials, including the most dovish Minneapolis Fed President Neel Kashkari, have mentioned so far. Therefore, although the stock market temporarily increased volatility, the likelihood of this trend continuing is limited. As Chairman Powell also mentioned, if supply shortages and increased demand have stimulated inflation, this trend is gradually improving, and the downward stabilization of inflation can continue.

◆ Han Ji-young, Researcher at Kiwoom Securities = Until the September US Federal Open Market Committee (FOMC) meeting, the stock market may be exposed to tightening uncertainties following Jackson Hole, but since these have already been priced in since the release of the July FOMC minutes on the 17th, the shock from the Jackson Hole aftershocks is expected to be limited. Also, since the Fed’s data-dependent stance has not changed, the intensity of the September FOMC rate hike will vary depending on employment and consumer price index results in September, so the market’s strategy of responding after confirming data is considered a realistic alternative. The domestic market closed sharply lower the previous day due to the US stock market plunge after the Jackson Hole meeting and the shock of the won-dollar exchange rate surging above 1350 won for the first time in 13 years, but today it is expected to attempt a rebound supported by the perception of an exaggerated drop and the easing of the exchange rate surge despite the Jackson Hole aftershocks.

Although overshadowed by Fed issues, concerns about the delisting of Chinese companies listed in the US due to the US-China accounting supervision agreement have been alleviated, and expectations for additional stimulus from the Chinese government are expected to contribute to the recovery of overall investment sentiment across Asia. While the overall index is expected to attempt an intraday rebound, differentiated stock price movements between sectors are anticipated due to individual issues such as the sharp rise in oil prices from the possibility of Saudi production cuts and the decline in natural gas prices due to increased reserves in Germany.

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