Today, South Korea's stock market is expected to attempt a significant rebound, buoyed by stable inflation in the U.S. and strong performance in AI semiconductor stocks. Following a surge in buying interest in memory semiconductors on U.S. exchanges, the KOSPI is likely to open higher. However, following recent sharp declines, there may be volatility in trading due to profit-taking and fluctuations in leveraged positions, potentially widening intraday price movements.
On the night of July 14, the New York Stock Exchange closed higher as the June Consumer Price Index (CPI) came in below market expectations, easing inflation concerns. The Dow Jones Industrial Average rose 0.02% to close at 52,508.27, while the S&P 500 gained 0.38% and the Nasdaq increased by 0.90%. The June CPI in the U.S. rose 3.5% year-over-year, falling short of the anticipated 3.8%, and decreased by 0.4% from the previous month, marking the largest drop since April 2020. Consequently, concerns over further interest rate hikes by the Federal Reserve have eased, with the probability of a rate increase in July dropping from 42% to 17%, according to the CME FedWatch Tool.
Expectations for increased investment in AI infrastructure have led to a strong performance in the semiconductor sector. The Philadelphia Semiconductor Index rose by 2.54%, and SK Hynix's American Depositary Receipts surged 27.29% after Barclays set a target price of $330, citing ongoing memory supply shortages and potential valuation adjustments. Micron and SanDisk also saw gains of 4.9% and 5.0%, respectively, boosting investor sentiment in memory-related stocks. Although IBM's shares plummeted over 25% due to concerns about slowing investment in its software division, the market interpreted this as a signal that companies are expanding their investments in AI infrastructure, particularly in servers, storage, and memory.
The domestic stock market is also expected to see a strong rebound, particularly among large-cap semiconductor stocks. As of 8:27 a.m. in pre-market trading, SK Hynix was up 8.42% at 2,074,000 won, while SK Square rose 8.99% to 1,297,000 won. Samsung Electronics increased by 5.89% to 278,500 won, and Samsung Electro-Mechanics climbed 5.95% to 1,335,000 won, indicating a wave of buying interest in major AI and semiconductor stocks.
Han Ji-young, a researcher at Kiwoom Securities, stated, "Given that the domestic stock market has faced unprecedented adjustments akin to a financial crisis, there is little room for further declines in stock prices or valuations. It is essential to align the market's direction with a recovery path rather than additional adjustments."
* This article has been translated by AI.
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