[Good Morning Market] U.S. Stocks Extend Rally on End-of-War Hopes... Positive Outlook for Korean Market

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The major indices of the U.S. stock market all showed strong gains. Market sentiment improved, interpreted as being driven by growing expectations for an end to hostilities following news that the United States and Iran may resume face-to-face negotiations within the next two days. This momentum is expected to contribute to a stable session in the domestic stock market as well.

On April 14 (local time) at the New York Stock Exchange, the S&P 500 index closed at 6,967.38, up 1.18% from the previous day. The technology-heavy Nasdaq Composite index also surged, ending the session up 1.96% at 23,639.08. The Dow Jones Industrial Average finished up 0.66% at 48,535.99.

Expectations for follow-up negotiations between the U.S. and Iran are seen as having warmed the market. U.S. President Donald Trump, in a phone interview with the New York Post, stated, "Something could happen within the next two days," hinting that a second round of negotiations to end hostilities could begin in Islamabad, Pakistan. The two sides are currently coordinating schedules, with the U.S. side reportedly considering the 16th as a likely date. Although it remains uncertain whether these negotiations will successfully lead to a formal end to hostilities, the market has responded positively to the prospect of talks resuming in itself.

As hopes for ending the conflict grew, international oil prices also turned downward. The price of West Texas Intermediate (WTI) crude futures plummeted 7.9%, closing at $91.28 per barrel.

Rising expectations for the earnings of companies involved in artificial intelligence (AI) infrastructure also pushed stock prices higher. Nvidia extended its winning streak for the 10th consecutive session, gaining 3.8% on the day. Micron Technology (up 9.2%) and Alphabet, Google’s parent company (up 3.6%), also posted solid gains.

Looking ahead, the market faces the challenge not only of a potential end to hostilities but also of gauging the inflationary impact of the war. The direction of inflation will shape monetary policy decisions by the U.S. Federal Reserve and influence market interest rates. Another source of relief was that the March Producer Price Index (PPI) rose only 0.5% month-on-month, well below market expectations of a 1.1% increase, following the March Consumer Price Index (CPI). Analysts also point out that the momentum from first-quarter earnings season in major economies such as Korea and the U.S. is providing additional support for the stock market rally.

This positive sentiment is expected to extend to the domestic stock market as well. The MSCI Korea ETF, which tracks the Korean stock market and often moves in tandem, surged 3.86%. The MSCI Emerging Markets Index ETF also climbed 1.92%. The Philadelphia Semiconductor Index rose 2.04% as well.

Ji-Young Han, a researcher at Kiwoom Securities, commented, "The KOSPI is expected to attempt to settle above the 6,000 level, driven by favorable factors both at home and abroad, including a sharp drop in oil prices due to reduced war-related uncertainty and strong performance in leading stocks such as semiconductors on the Nasdaq." She added, "While the technical rebound was strong given the previous steep declines, the relative earnings momentum advantage of the KOSPI has remained intact."

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