[Good Morning Market] U.S. Stocks Stall on Disappointing OpenAI Results... KOSPI Also Expected to Pause

All Three Major U.S. Indices Decline
Profit-Taking Hits AI and Semiconductor Stocks
Focus on M7 Earnings and Upcoming FOMC Meeting

On news that OpenAI's performance fell short of expectations, major technology stocks such as Nvidia and Oracle saw heavy sell-offs, leading to a decline in the U.S. stock market. The domestic stock market is also expected to experience a pause, as investors seek to realize profits after the recent rally.

On April 28 (local time) in the New York stock market, the S&P 500 Index closed at 7,138.80, down 0.49% from the previous day. The tech-centered Nasdaq Composite Index also fell by 0.90% to close at 24,663.80. The Dow Jones Industrial Average closed at 49,141.93, with the smallest decline of 0.05%.

This is seen as a result of renewed concerns over the AI industry following the news that OpenAI missed its performance targets. In addition, heightened caution towards the earnings of the major seven U.S. big tech companies (M7) led to corrections in semiconductor and AI-related stocks such as Nvidia (-1.6%) and Micron Technology (-3.9%). Oracle and CoreWeave, the largest cloud providers for OpenAI, also fell by more than 4% each.

The rise in international oil prices also added pressure. On this day, crude oil futures prices closed with Brent crude up 2.8% from the previous session at $111.26 per barrel, and West Texas Intermediate (WTI) up 3.7% at $99.93 per barrel. This is interpreted as stemming from concerns over supply disruptions due to ongoing tensions in the Middle East and the stalemate in peace negotiations between the U.S. and Iran.

The upcoming U.S. Federal Reserve (Fed) Federal Open Market Committee (FOMC) meeting also dampened buying sentiment. The prevailing expectation is that the U.S. base interest rate will be held steady at the current 3.75% level. However, the market is focusing more on what Fed Chair Jerome Powell will say regarding the recent rise in oil prices and inflation risks rather than the rate decision itself.

The domestic stock market is also expected to be somewhat subdued. The MSCI Korea ETF, which mirrors the domestic market, declined by 1.51%. The MSCI Emerging Markets ETF also fell by 1.02%. The Philadelphia Semiconductor Index plunged by 3.58%.

Han Ji-young, a researcher at Kiwoom Securities, said, "However, after the U.S. market closed, Seagate, which announced its earnings, surged more than 15% in after-hours trading on raised guidance due to strong storage demand outlook. As a result, semiconductor stocks such as Micron and SanDisk are also rebounding after hours, which could provide downside support for domestic semiconductor stocks. Bloom Energy also soared more than 12% in after-hours trading after an earnings surprise and upward guidance revision, which could provide a positive supply and demand environment for domestic value chain stocks related to power equipment and fuel cells."

Yonhap News Agency

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